James Faucette, an analyst from Morgan Stanley, maintained the Hold rating on PayPal Holdings. The associated price target remains the same with $75.00.
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James Faucette has given his Hold rating due to a combination of factors related to PayPal Holdings’ current market position and future prospects. The investor sentiment towards PayPal is notably negative, with many expressing concerns about the company’s ability to enhance its Branded Checkout growth amidst rising competition. Although the valuation might limit significant downside risks, the lack of clear catalysts for upward movement in the stock price is a concern.
Furthermore, recent initiatives such as improvements in checkout processes, Venmo, and Buy Now Pay Later (BNPL) services have not significantly boosted market share, and there are apprehensions about PayPal’s ability to compete effectively in the emerging agentic commerce space. Despite some positive trends in eCommerce, PayPal is expected to report only mid-single-digit growth in Branded Checkout, and there are additional headwinds impacting transaction margin growth, such as service disruptions and tougher comparisons from previous interest income levels.