US · Nasdaq · PYPL
PayPal (PYPL) stock analysis: valuation and financials
Industrials · Diversified Commercial Services
$56.00 -0.1% Price as of Oct 13, 2026
Two-sided payments network earning 24.2% ROIC with only $67M net debt, but growth stalled at 4.3% and FCF margin fell to 16.8%; at 9.5x earnings the price already discounts stagnation.
- Market cap
- $47.9B
- P/E
- 9.5x
- EV/Sales
- 1.4x
- FCF yield
- 11.5%
- Dividend yield
- 1.0%
- 52-week range
- $39.08 – $76.13
- Next earnings
- Oct 27, 2026
Research as of Oct 13, 2026
Business quality scorecard
- Growth51
- Profitability66
- Cash flow84
- Balance sheet75
- Capital allocation99
- Valuation100
0–100, computed from reported financials; higher is better, and a higher valuation score means cheaper.
How it makes money
PayPal charges merchants and consumers transaction fees on $1.79T of TPV — 89.8% of FY2025 revenue — plus faster-growing value-added services (10.2% of revenue, +14.2% yoy); the transaction engine funds nearly all of the $6.07B operating income (18.3% margin).
Financials by year
| FY2021Jan–Dec 2021 | FY2022Jan–Dec 2022 | FY2023Jan–Dec 2023 | FY2024Jan–Dec 2024 | FY2025Jan–Dec 2025 | |
|---|---|---|---|---|---|
| Revenue | $25.4B | $27.5B | $29.8B | $31.8B | $33.2B |
| Revenue growth | +18.3% | +8.5% | +8.2% | +6.8% | +4.3% |
| Operating margin | 16.8% | 13.9% | 16.9% | 16.7% | 18.3% |
| Net income | $4.2B | $2.4B | $4.2B | $4.1B | $5.2B |
| Free cash flow | $4.9B | $5.1B | $4.2B | $6.8B | $5.6B |
| FCF margin | 19.3% | 18.6% | 14.2% | 21.3% | 16.8% |
Amounts in USD · What is free cash flow?
Margins Gross margin is not separately reported. Operating margin rose to 18.3% in FY2025 from 16.8% in FY2024 (+153bp) as transaction-expense growth (2%) lagged TPV growth (7%), then eased to 17.9% TTM and 17.8% in Q1 FY2026 as the transaction-expense rate rose on Braintree and funding mix.
- Cash flow HealthyOperating cash flow exceeded net income: FY2025 OCF $6.42B vs net income $5.23B; TTM OCF $6.39B vs net income $5.06B, cash conversion 1.373x.
- Debt LowNet debt is only $67M: total debt $9.41B against cash $6.98B plus short-term investments $2.37B; net debt/EBITDA 0.01x, debt/equity 0.47x.
Balance sheet Leverage · Low
- Cash & short-term investments
- $9.3B
- Total debt
- $9.4B
- Net debt
- $67.0M
- Net debt / EBITDA
- 0.0x
- Interest coverage
- 13.4x
- Current ratio
- 1.3x
As of Mar 31, 2026 · Amounts in USD · How to read a balance sheet
Management and track record
- Management AdequateCapital allocation is the strong point: five-year buybacks of $24.67B versus $6.34B stock compensation; diluted shares fell from 1,187M to 968M (-5.8% CAGR). FY2025 ROIC 24.2%, up 10.3pp over three years.
- Credibility Medium2025 EPS guidance beaten every quarter: 2Q'25 GAAP EPS $1.29 vs $1.24-$1.26 guided, 3Q'25 $1.30 vs $1.14-$1.18, 4Q'25 $1.53 vs $1.23-$1.27, FY25 $5.41 vs raised $5.11-$5.15.
Of 6 guided figures checked: 6 beat, 0 in range, 0 missed.
Valuation range
Implied value per share · Price when researched: $56.00
Each scenario assumes five years of revenue growth, an FCF margin and an exit multiple, discounted to today. The assumptions and sensitivities are in the full report.
The full report also covers
- Revenue, growth and outlook of each segment
- Moat and main competitors
- Key risks
- Capital allocation: where the free cash flow went
- What management promised, and what they delivered
- Scenario assumptions and sensitivities
- A source for every claim
- Ask AI about this company
The full report is for members.