PayPal finds itself navigating a wave of analyst pessimism. Despite posting robust quarterly figures last autumn, the financial giant now faces mounting criticism from major institutions. In a coordinated move, three prominent investment banks have significantly lowered their price targets for the shares in recent days, citing fundamental concerns over the company’s core growth trajectory. Trading near $61, the stock now sits more than 25% below its value at the start of the year.
Strong Quarterly Performance Overshadowed by Guidance
The current negative sentiment appears counterintuitive at first glance. For the third quarter of 2025, PayPal’s results exceeded market expectations across key metrics:
- Earnings per share: $1.34 (forecast: $1.20)
- Revenue: $8.42 billion (forecast: $8.21 billion)
- Net margin: Approximately 15%
However, the subsequent outlook provided by management quickly tempered any enthusiasm. Chief Financial Officer Jamie Miller indicated that growth in the branded checkout segment might decelerate in the fourth quarter. This cautious guidance has exerted sustained pressure on the share price, causing PayPal to lag behind the broader Nasdaq Composite’s performance.
Investment Banks Express Doubts on Core Business
A series of downgrades this week prompted a market reaction. Evercore ISI cut its price target from $75 to $65, pointing to persistent challenges within PayPal’s flagship “Branded” checkout business. Analysts there suggested a significant share price recovery is unlikely until this segment demonstrates clearer signs of stabilization. The firm also noted that future returns might require intervention from the board of directors or activist investors.
Should investors sell immediately? Or is it worth buying PayPal?
Acting concurrently, Wells Fargo reduced its target from $74 to $67 while maintaining an “Equalweight” rating. Compass Point took a more severe stance, slashing its target to $56 and issuing a “Sell” recommendation. This collective action underscores a growing skepticism regarding the stock’s near-term valuation prospects.
Strategic Moves Fail to Counter Broader Pressure
In its operational strategy, PayPal is seeking new avenues for growth. A recently announced strategic partnership with Logicbroker aims to bolster its B2B division through so-called “Agentic Commerce Services.” In a separate minor development, U.S. Senator John Boozman purchased shares worth up to $15,000. While a positive signal, this insider buying activity has been insufficient to offset the prevailing institutional selling pressure.
From a technical analysis perspective, the outlook remains challenging. The shares are currently trading well below their key moving averages and more than 30% beneath their 52-week high of nearly $94. Market experts agree that without a visible turnaround in the branded checkout operations, the current climate of analyst doubt is likely to persist.
Ad
PayPal Stock: Buy or Sell?! New PayPal Analysis from December 9 delivers the answer:
The latest PayPal figures speak for themselves: Urgent action needed for PayPal investors. Is it worth buying or should you sell? Find out what to do now in the current free analysis from December 9.
PayPal: Buy or sell? Read more here...
