PayPal Offers Growth Potential But Comes With Risks.

(CTN News) – PayPal Holdings Inc., a well-known company, was separated from eBay Inc. in 2015. Despite experiencing a remarkable surge of 790% in its stock price until July 2021, it has now declined by 80% from its peak. While there are significant reasons for this decline, I am confident that the current stock presents a substantial value opportunity in the market.

The company’s GF Score, currently at an exceptional 97 out of 100, highlights its strong performance. However, I am also keen on scrutinizing the stock for hidden discrepancies.

By delving into the operational intricacies, I aim to uncover any potentially overlooked flaws and competitive challenges that may lie ahead.

eBay’s transition to its payment system in June 2021 has been identified as a significant factor contributing to the company’s share price decline.

This move resulted in a notable decrease in the number of eBay users who opted to pay using PayPal.

As a result, PayPal’s revenue from eBay plummeted to just 4% in 2021, experiencing a sharp decline of 45% within a quarter.

However, despite these challenges, PayPal demonstrated resilience and growth, with its payment volume increasing from $1.25 trillion in 2021 to $1.36 trillion in 2022.

During the pandemic, PayPal thrived as an online payment provider, as highlighted by CNBC’s Juhohn Lee. The company’s revenue surged from $17.8 billion in 2019 to over $25 billion in 2021.

At one point, e-commerce sales accounted for 16.4% of all retail sales in the U.S., but this figure has remained below 15% for the past two years as life gradually returned to normal, leading to a decline in stock performance.

Furthermore, PayPal has faced intensified competition from various players such as Block (NYSE: SQ), Stripe, Apple (NASDAQ:AAPL) Pay, and Google (NASDAQ: GOOG) (NASDAQ: GOOGL) Pay.

These competitors have encroached upon areas that once dominated. Determining PayPal’s precise market share in the ever-evolving payment management market, which encompasses multiple revenue sources, is challenging.

However, according to 6Sense, PayPal currently holds the largest share in this market at 40.43%, surpassing Stripe’s 36.99%.

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