Key insights
- The author notes PayPal's relative outperformance compared to the S&P 500 since its earnings release, attributing it to buybacks and dividends. While acknowledging potential headwinds from the oil shock impacting businesses using PayPal, the author suggests the price action indicates a possible bottom and improved forward prospects relative to the broader market. This suggests a mildly bullish outlook for PYPL.
Since their earnings on Feb 2 shot the stock in the face it is up 10% while the SPY is down 8%. Buybacks are massive in this area at 15% and the dividend has reached 1.25%.
I’m so deep in losses and paying back margin I can’t add heavily and don’t know if I would regardless given how hard may businesses using PYPL will be hit by this oil shock, but price action is at least seeming to say that we have somewhat bottomed and there are much better forward prospects compared to the overall market.
Wha are you guys thinking looking at the situation as it stands today?