PAYPAL

Analysis of Paypal share price

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Are you planning to invest on the stock market and want to buy Paypal shares online? Find out how to achieve this with some essential information that will help you to see more clearly and to carry out analyzes of the price of this stock in the more or less long term. We invite you to find out in this article some essential stock market data about this title such as its online ranking or an analysis of its historical stock charts, as well as explanations about the detailed activities of this group and the amount of turnover that they generate.

Elements that can influence the price of this asset:

Analysis N°1

Firstly, it will be necessary to closely monitor the acquisition of new customers by PayPal, through the establishment of strategic partnerships with large online sales sites. This has been the case in the past with eBay and many others.

Analysis N°2

Particular attention should also be paid to the innovations developed by PayPal as part of its competitive strategy. Indeed, the group must constantly innovate in order to attract customers and be able to compete. We will therefore keep an eye on the group's investments in R&D.

Analysis N°3

Paypal's competitors are becoming more and more numerous on the market as the dematerialisation of money and payments progresses. It will therefore be important to pay attention to these opponents by taking into account their major news, their results and the evolution of their market shares.

Analysis N°4

It will also be interesting to follow the evolution of the share of online commerce versus physical commerce in order to detect the most favourable periods for PayPal's activities.

Analysis N°5

The increasingly strict regulation of payment services and systems will have to be studied with great care, as it may penalise the group's activities or, on the contrary, allow it to increase its presence on the market.

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General presentation of Paypal

You have probably already heard about Paypal or have already used at least once this system of online payment to make secure purchases online. But what you may not know is that the company that has put in place this system is now one of the largest American companies listed on the stock market.

The American company Paypal Holding is in fact one of the leading providers in the sector of online payment services on an international scale. Its innovation allows individuals and businesses to carry out transactions of purchase and sale of goods and services online, as well as the transfer and withdrawal of funds.

It is thanks to the operation of a highly technological and innovative platform that Paypal can offer such services. This platform is in fact equipped with various solutions to simplify payments on merchant sites, through mobile devices or in stores. These solutions can be found under the form of Paypal, Paypal credit, Venmo and Braintree.

Paypal generates more than 53% of its turnover in the United States. It then hits the UK market with 11.6% and then the rest of the world.

Analysis of Paypal share price
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The major competitors of Paypal

Now that you are familiar with the PayPal group and its activities in the online payment sector, we invite you to improve your knowledge of its main competitors in the market. Indeed, several new companies have developed in this sector, the most important of which are currently

Square

First of all, the Square group is an American company specialised in mobile and electronic payments which is based in San Francisco. The group was created in 2009 and quickly made several strategic acquisitions, including that of Viewfinder in 2013. The company has two million users and was listed on the NYSE in 2015. Recently, the group acquired Afterpay, an Australian company specialising in fractional payments.

Wise

Wise, formerly known as TransferWise, is an international peer-to-peer money transfer company that was founded in January 2011. The company is currently headquartered in London and has no less than eight branches worldwide including New York, Sydney and Singapore. The group has more than four million customers on its platform and processes more than €800 million in transfers per month with 45 commercial destinations worldwide and multi-currency accounts.

Skrill

Another group to keep an eye on is Skrill Group, formerly Moneybookers, which is a UK-based online payment and banking company that allows instant money to be sent and received. The group currently has 30 million registered users on its service, which operates in many currencies.

Stripe

The American company Stripe specialises in online payments for professionals. Web developers integrate payment processes here without the need for a merchant account. The group is expected to go public in early 2022.

Amazon Pay

Finally, the Amazon group also offers a service called Amazon Pay wherever this payment option is visible and which allows payment on its customers' online shops. This recent and innovative service is however only available to Amazon customers with an account and also on Alexa. However, it is not impossible that the group will start to offer this service to external merchants at a later date.


The major partners of Paypal

To finish, here are Paypal’s main partnerships.

Mastercard & Visa

In 2016, Paypal announced the establishment of partnerships with the two major global groups of credit cards Matercard and Visa in order to offer in-store transactions.

Aon & Europ Assistance

In 2017, Paypal also signed a partnership with the groups Aon and Europ Assistance in order to offer a free travel cancellation insurance program to its users.

Samsung

Always in 2017, Paypal signed a partnership with Samsung for its Samsung Pay service, and then, some days later, it announced a similar partnership with Apple for the payment of purchases on Itunes, iBooks, Apple music and Apple Store.

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The factors in favour of a rise in the Paypal share price:

An effective trading strategy on the PayPal share price should certainly begin with a comprehensive understanding of the strengths and weaknesses of this group in order to comprehend its ability to develop its activities and continue the company’s growth in the coming years. Before making long term decisions you should therefore reflect on these various points. To begin with we shall start by examining the strengths of this group.

Firstly PayPal is renowned worldwide as a highly secure online infrastructure which presents a reassuring image to the general public and enables it to benefit from an increasing high esteem.

PayPal also benefits from the advantage of offering its online payment services on an international level. In fact, this payment system already enables users from numerous countries worldwide to pay for their purchases or sell items easily online. PayPal is actually available in 24 different currencies and in total there are over 190 different markets worldwide that are related to PayPal. 

The PayPal Group can also count upon its numerous users to publicise its services without the need to invest heavily in marketing and communications. This payment system actually accounts for no less than 153 million users worldwide.

Finally, PayPal is often used by scammers that use the ‘fishing’ method, the group has managed to effectively react to this threat by publishing numerous warnings on its website as well as implementing an identification system and signalling notifications of this type of scam.

The factors in favour of a drop in the Paypal share price:

We shall continue by reviewing the disadvantages of the PayPal company or the weak points that could lead to a negative influence on its growth and therefore indirectly on its stock market share price.

Firstly, it is important to remember here that the PayPal Group is highly exposed to risks related to fraud and that, despite the different methods used, its system of online transactions is still held responsible by many consumers and consumer associations. The potential users of this system can therefore feel nervous about an apparent lack of confidentiality or respect for private information. Numerous controversies relating to transactions completed through this system still regularly make the news which engenders bad publicity for the group and could negatively impact the brand image over the long term.    

Another weak point of the PayPal Group relates this time to its difficulties in positioning itself in certain areas around the world, notably in emerging markets. In these countries consumers are still fairly reticent with regards to these new online sales methods. These consumers remain fairly conservative and too nervous to fully embrace this modern technology. 

Also, in other countries around the world such as China, Japan, Taiwan or India, the PayPal Group faces certain local restrictions which of course negatively impact its sales by disrupting the system implemented by the group for the general operation of the platform. 

The information supplied here is only for indicative purposes and should not be used without the completion of a comprehensive and complete fundamental analysis of this asset notably taking into account exterior data, future publications and announcements and all fundamental events and news that could influence the strengths and weaknesses or make them more or less significant. This information does not in any way constitute recommendations relating to the completion of transactions.

Frequently Asked Questions

Who are the largest private shareholders of Paypal?

At present, part of the capital of Paypal is held by private shareholders. These include The Vanguard Group at 7.43%, Fidelity Management & Research at 6.77%, Pierre Omidvar at 4.97%, SSgA Funds Management at 3.89%, T Rowe Price Associates at 3.56%, BlackRock Fund Advisors at 2.41%, Capital Research & Management at 1.44% Edgewood Management at 1.43%, Geode Capital Management at 1.35% and JPMorgan Investment Management at 1.34%.

When did the split between Paypal and eBay take place?

Paypal was bought by the eBay group in 2002, shortly after its IPO, for 1.5 billion dollars. But the Paypal group is today an independent entity since the two companies have split their activities in September 2014. This split was effective in July 2015.

Is the Paypal share part of the composition of the Nasdaq 100 stock market index?

As you may already know, Paypal is currently listed in the United States on the Nasdaq Global select market. This financial market place indeed gathers American technology stocks. But this company is also part of the composition of the Nasdaq 100 stock market index and is therefore one of the 100 companies in this sector with the largest capitalisation, which makes its popularity among investors more important.

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