Positions I’m Watching: PayPal
Positions I’m Watching: PayPal
By: Stacey Nickens
Due to the pandemic, more people are shopping online rather than in store. As a result, the online payment industry has seen a big increase in demand. The online payment platform, PayPal, has accordingly benefited, and its stock has grown over 50% during the past three months.
PayPal has partnerships with a number of online retailers that allow users to pay for purchases using their PayPal account. PayPal also benefits from the ease of transferring money through their platform. Users need only enter an email address in order to send money to another user. PayPal’s fourth quarter earnings reflect the popularity of these services. Their revenue clocked in at $6.12 billion, beating the expected $6.09 billion. Their earnings per share (EPS) also exceeded expectations. Analysts predicted PayPal to report EPS of $1.00, and in reality, PayPal reported EPS of $1.08.
PayPal has also been expanding its offerings during the pandemic, positioning the company for more growth moving forward. PayPal recently added Bitcoin to its trading platform. PayPal could thus profit off of the continued growth of cryptocurrency. With these additions to their offerings, PayPal reported a record amount of new account growth in 2020. Analysts expect this growth to continue moving forward, especially as individuals return to traveling and attending events.
Beyond considering individual PayPal stock, you could also look into many exchange-traded funds (ETFs) that have significant positions in PayPal. Some of these ETFs include the Invesco QQQ Trust (QQQ), the iShares U.S. Industrials ETF (IYJ), and the ETFMG Prime Mobile Payments ETF (IPAY).
