Market News

PayPal (NASDAQ:PYPL) and Coinbase (NASDAQ:COIN) Are Screaming for Attention

Story Highlights

PayPal and Coinbase stocks have taken a hit, the companies are taking steps to ensure that their businesses can thrive in the long term. PayPal’s share repurchase program may give a boost to the stock price.

In a bid to bolster their crypto businesses, Coinbase (COIN) and PayPal (PYPL) have teamed up on the industry-standard initiative dubbed the “TRUST” network.

Coinbase operates as the top crypto exchange in the U.S. It also offers crypto payment services through a debit card. Although it is best known for its online payment solutions, PayPal has also ventured into the crypto business. It offers crypto investing and transfer services through its namesake PayPal and Venmo brands.

PayPal Joins Coinbase-Led TRUST Network for Crypto Compliance

PayPal has become a member of the crypto industry-standard group TRUST. Launched in February 2020, the initiative is about helping crypto service providers achieve both Travel Rule compliance and customer privacy and security protection. The Travel Rule requires financial service providers to exchange certain customer details when processing transactions over a certain amount.

With PayPal on board, the TRUST network now has 38 members. The others include Robinhood (HOOD), Circle, Kraken, Gemini, and BlockFi.

PayPal and Coinbase Stocks Dip

PayPal shares have gained 14% in the past month, but they are down 52% year-to-date. Coinbase shares have risen 6% in the past month, but they have plummeted 72% year-to-date.

Coinbase CEO Brian Armstrong has said the company continues to look at areas where it can cut costs, according to a CNBC report. The company is also looking at subscription revenue opportunities. PayPal has also tried to excite investors with the announcement of a new $15 billion stock repurchase program. 

Is PayPal a Good Buy Right Now?

Although PYPL stock has dropped steeply from where it was at the beginning of the year, Wall Street remains bullish on it. According to TipRanks’ analyst rating consensus, PayPal stock is a Moderate Buy based on 23 Buys and eight Holds. The average PYPL stock forecast of $120.08 implies over 28% upside potential.

PayPal stock is a favorite of Wall Street elites. TipRanks’ Hedge Fund Trading Activity tool shows that confidence in PYPL is currently Very Positive. Some 39 hedge funds increased their cumulative holdings of the stock by 19.2 million shares in the last quarter. Activist investor Elliott Management recently revealed a $2 billion stake in PYPL stock.

PayPal scores a nine out of 10 from TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.

Final Thoughts

Although crypto remains a tiny business for PayPal, the stock still deserves attention from investors who may be seeking some crypto stock exposure. Joining the Coinbase-led TRUST network could help PayPal avoid trouble in its budding crypto business. Moreover, the company’s buyback program has the potential to lift the stock.

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