PYPL Stock Climbs On Better-Than-Feared Guidance, PayPal Stock Buyback


PayPal Holdings (PYPL) reported mixed June-quarter financial results as earnings fell from a year earlier but topped views as total payment volume missed estimates. PayPal stock climbed on Tuesday as the company added $15 billion to its stock repurchase program.




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In addition, PayPal profit guidance for the September quarter met expectations, while its revenue forecast came in slightly below views. PayPal plans to save $900 million in cost-cutting moves in 2022, the company said.

San Jose, Calif.-based PayPal announced the appointment of Blake Jorgenson as its new chief financial officer. Jorgenson had been executive VP of special projects at video game company Electronic Arts (EA).

Also, PayPal confirmed that hedge fund Elliott Management has taken a $2 billion stake in the company.

PayPal reported earnings late Tuesday. PYPL stock climbed 11.6% to 100.09 in extended trading on the stock market today. In Tuesday’s regular session, PayPal stock rose 1.2%.

PayPal earnings for the quarter ended June 30 came in at 93 cents per share, down 19% from a year earlier. The e-commerce company said revenue rose 10% to $6.8 billion.

Analysts expected PayPal earnings of 87 cents a share on revenue of $6.78 billion. A year earlier, PayPal earned $1.15 a share on sales of $6.24 billion.

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PayPal Stock: Payment Volume Light

In Q2, total payment volume processed from merchant customers climbed 13% to $339.8 billion. Analysts had projected total payment volume of $342.83 billion.

For the current quarter ending in September, PayPal forecast EPS of 95 cents, in line with estimates. PayPal forecast revenue of $6.8 billion, below estimates of $7.02 billion.

As e-commerce boomed during the coronavirus pandemic, shares in PayPal soared. But PayPal stock had plunged about 71% from an all-time high of 310.16 on July 26, 2021.

PayPal stock holds a Relative Strength Rating of only 13 out of a best-possible 99, according to IBD Stock Checkup.

Former parent eBay (EBAY), which spun off PayPal in 2015, has shifted its payment processing from PayPal to Netherlands-based Adyen.

If you’re new to IBD, consider taking a look at its stock trading system and CAN SLIM basics. Recognizing chart patterns for issues such as PYPL stock is one key to the investment guidelines.

Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.

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