Paypal (PYPL) Outpaces Stock Market Gains: What You Should Know
Paypal (PYPL) closed at $91.60 in the latest trading session, marking a +1.29% move from the prior day. The stock outpaced the S&P 500's daily gain of 1.07%. Meanwhile, the Dow gained 0.65%, and the Nasdaq, a tech-heavy index, added 1.71%.
Prior to today's trading, shares of the technology platform and digital payments company had gained 7.53% over the past month. This has outpaced the Computer and Technology sector's loss of 2.02% and the S&P 500's loss of 0.58% in that time.
Wall Street will be looking for positivity from PYPL as it approaches its next earnings report date. This is expected to be January 30, 2019. On that day, PYPL is projected to report earnings of $0.67 per share, which would represent year-over-year growth of 21.82%. Meanwhile, our latest consensus estimate is calling for revenue of $4.24 billion, up 13.21% from the prior-year quarter.
Any recent changes to analyst estimates for PYPL should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.09% lower. PYPL currently has a Zacks Rank of #4 (Sell).
Investors should also note PYPL's current valuation metrics, including its Forward P/E ratio of 31.36. This valuation marks a discount compared to its industry's average Forward P/E of 46.69.
Also, we should mention that PYPL has a PEG ratio of 1.72. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Internet - Software stocks are, on average, holding a PEG ratio of 2.47 based on yesterday's closing prices.
The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 36, putting it in the top 15% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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