Does PayPal’s Bid To Launch “PayPal Bank” Transform The Bull Case For PayPal Holdings (PYPL)?

• In recent days, PayPal Holdings has applied to establish “PayPal Bank,” a Utah-chartered industrial loan company that would expand its small-business lending, offer interest-bearing savings accounts, and reduce reliance on partner banks while bringing deposits under FDIC insurance.
• At the same time, several major Wall Street firms have downgraded PayPal, highlighting concerns about its core branded checkout competitiveness, Venmo monetization, and the operational and regulatory implications of becoming more bank-like.
• We’ll now examine how PayPal’s push to create its own bank could reshape its investment narrative built around commerce and payments.

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PayPal Holdings Investment Narrative Recap

To own PayPal, you need to believe its large, profitable payments network can stay relevant while it reinvents itself around AI-driven commerce and more bank-like services. The key near term catalyst is whether branded checkout and new agentic commerce offerings can stabilize sentiment despite multiple downgrades, while the biggest current risk is that competition and execution challenges in these same areas slow progress more than markets expect. The PayPal Bank application does not yet change that risk reward balance in a material way.

Among recent announcements, the Logicbroker partnership stands out as directly tied to PayPal’s AI and agentic commerce push. By making Logicbroker merchants’ catalogs “agent-ready” across multiple AI shopping channels through a single PayPal integration, it reinforces the same short term catalyst investors are watching: whether PayPal can convert its payments scale into meaningful commerce and data advantages as shopping increasingly begins inside AI powered experiences.

Yet while PayPal is leaning into AI commerce, investors should be aware of intensifying competition in key markets and how it...

Read the full narrative on PayPal Holdings (it's free!)

PayPal Holdings' narrative projects $38.1 billion revenue and $5.4 billion earnings by 2028. This requires 5.6% yearly revenue growth and about a $0.7 billion earnings increase from $4.7 billion today.

Uncover how PayPal Holdings' forecasts yield a $82.00 fair value, a 38% upside to its current price.

Exploring Other Perspectives

Fifty one members of the Simply Wall St Community value PayPal between US$74.76 and US$146.24, reflecting wide conviction gaps. Against that backdrop, concerns about PayPal’s branded checkout competitiveness and rising AI commerce rivals could meaningfully influence how those expectations play out.

Explore 51 other fair value estimates on PayPal Holdings - why the stock might be worth just $74.76!

Build Your Own PayPal Holdings Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your PayPal Holdings research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.
• Our free PayPal Holdings research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate PayPal Holdings' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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