|By Nathan Young|
PayPal operates as a platform that consumers as well as merchants can use to receive and send mobile payments. Since the introduction of the debit card, money has become more and more paperless. With Bitcoin and Apple Pay, these products are only aiding in the growth of PayPal. This company is widely used in the online retail space, specifically Amazon and PayPal. As the world become more and more digital, PayPal should only benefit more from this transition.
The following information has been derived from PayPal’s 8-K filing on October 20th of 2016. Revenue over the third quarter showed growth of 18% to $2.667 billion and an earnings per diluted share growth of 8% to $0.27. Active customer accounts are at 192 million, up 11% with 19 million active user growth. PayPal states they have gained market share during the third quarter, which is a great sign and supports the fact the world is becoming more digital with money movement.
Going forward, PayPal expects to grow revenue 17% for the full 2016 year. Short term, they are stating that revenue is expected to grow 14%-17% during Q4 2016. All in all, it appears PayPal is on the way up and if they fulfill the growth projections as they stated, stock growth is highly likely.
From a Technical standpoint, the chart shows healthy movement and provides great opportunities for entry. The $41.00 area appears to be a resistance/support level as of recent and should be monitored if you’re investing solely on technical analysis. That area formed a triple top and broke to the upside and is now being held as support.
A risk that was mentioned in PayPal’s 10-Q filing is that they are sensitive to bank fees, rules, or practices. They rely on banks and other payment processors to process transactions, and in turn, PayPal pays a fee. Another sensitive topic with PayPal is fraud and the resolution of fraudulent transactions. With recent hackings with Target and Yahoo, customer security is the most important item and could potential damage a brand name. PayPal must maintain a clean image and when fraud happens, they are able to resolve it quickly and efficiently. Lastly, it was stated that the United Kingdom’s departure from the European Union could adversely affect the company. The company stated that they could potentially lose their ability to operate in the U.K. market as well as be forced to obtain additional licensing.
With the ever changing technology sector and the way we process money, it would be foolish to ignore a company such as PayPal. As the acceptance of Bitcoin grows and the elimination of physical currency continues, this will allow PayPal to gain traction and
|This media report from Macroaxis distributed on November 9, 2016 was a factor to the next trading day price decrease.The trading delta at closing time against the next closing price was 1.96% . The trading delta at closing time when the story was published against the current closing price is 96.19% .|