PayPal stock gains on bullish upgrade from Truist

Yahoo Finance Live anchors discuss why PayPal stock is up on Tuesday.

Video Transcript

SEANA SMITH: So let’s kick it off with PayPal. It’s the top trending ticker on Yahoo Finance today. The stock kicking off the new year on an upbeat note. Look at that. We’re looking at gains of just about 5%. Now that coming after Truist upgraded the stock to a buy, making the case that investors seem to be, quote, “too negative” on the stock at this point. And now analyst Andrew Jeffrey liking Paypal’s $6 billion cash position, saying that it brings flexibility for potential M&A and also for buybacks.

Now Truist’s new price target of 95 bucks a share, you can see about 20 bucks higher from where we’re trading today, about 38% higher from where the stock closed at the end of 2022. So, Pras, a much more bullish, I guess, optimistic outlook from Truist here from PayPal that was coming off what was a pretty challenging year, not only for that name, but for many of the names within the sector.

PRAS SUBRAMANIAN: Yeah, you know, PayPal the granddaddy of the space, right? I’m looking at some numbers here. 4P, 15, that’s very fair. Last quarter, $7 billion revenue, 20% margins. I mean, this is a great kind of business. And I think that at these levels, they’re making the case there, especially with that $6 billion cash hoard. You can kind of maybe acquire a beaten down company that could sort of increase their moat. They have Venmo. People use that all the time. I use it all the time. I think it’s a great business for PayPal. It’s just, I think, a good call.