PayPal shares under the microscope ahead of Q1 earnings call
PayPal is set to report its Q1 2021 earnings on 5 May. What is the outlook for PayPal, and will the world’s original peer-to-peer payment platform continue its charge after total payment volumes rose by 31% in 2020?
- PayPal shares up 33% in the last six months
- $1.01 per share profit targeted
- 50 million new accounts anticipated this year
- Looking to trade the PayPal share price? Open an account today
Fintech giant PayPal (PYPL.O) is anticipating quarter one (Q1) 2021 revenues to be 28% up year-on-year (YoY), recording $5.9 billion in overall revenue. If correct, investors will secure $1.01 profit per share, which will be a 53% rise in earnings per share (EPS) compared with the same quarter in 2020.
PayPal concluded 2020 with active accounts totalling 377 million, with total payment volume (TPV) weighing in at $936 billion, thanks largely to the 73 million new accounts and the world’s continued embrace of digital transactions.
Will the bullish trend continue in 2021?
The PayPal share price has enjoyed considerable growth in the last six months, proving right the analyst forecasts that PayPal shares had plenty of upside at $199.00 last summer. It’s risen over 33% from $194.29 in November 2020 to $259.09 in May 2021. During that period, record highs were also achieved of $304.79 in February 2021, followed by a sharp retraction to $226.09 in early March.
Since then, PayPal shares have rebounded again, which is a strong indicator that Q1 2021 earnings are likely to prove encouraging for the platform. In 2020 alone, digital transactions posted an unprecedented 116% annual return, with a further 12% rise in 2021 to date.
The impact of the Covid-19 pandemic has been the perfect storm for PayPal, as consumers grew increasingly reliant on digital transactions. It’s clear that the platform remains the most trusted digital wallet, with cryptocurrency exchange Coinbase recently permitting its users to buy and sell cryptocurrencies using debit and credit cards linked to their PayPal logins.
Does the PayPal share price depend on the success of its broader product portfolio?
Through strategic acquisitions, PayPal continues to innovate the digital payments space in the tech sphere. In December 2013, PayPal acquired Venmo owner Braintree in a deal worth $800 million. The purchase enabled PayPal to reach out to millennial and generation Z consumers that prefer Venmo’s social payment app for money management.
Alongside Venmo, PayPal’s additional product portfolio is also positioning the platform well to continue its charge into 2021 and beyond. One Touch competes with Amazon’s (AMZN.O) rapid ‘buy now’ payment preferences to accelerate online transactions, while Xoom makes it possible to send funds and pay bills overseas, which has been a boon for many individuals affected by travel restrictions imposed by Covid-19.
The reinforcement of innovative and trustworthy user engagement on the PayPal platform via its added value services is one of the main reasons why its payment volumes are said to have accelerated further still in Q1 2021.
Go long or short on the value of PayPal shares today
Take your position on US shares for just a small initial deposit with CFDs.
Whether you trade or invest, you’ll get access to pre-market and after-hours trading on 70 US stocks.
Open an account to get started.
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk. Please see important Research Disclaimer.
Please also note that the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.
Seize a share opportunity today
Go long or short on thousands of international stocks.
- Increase your market exposure with leverage
- Get spreads from just 0.1% on major global shares
- Trade CFDs straight into order books with direct market access
Live prices on most popular markets
- Forex
- Shares
- Indices
See more forex live prices
See more shares live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
See more indices live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.
