PayPal Transaction Margins and Payment Volume Drive Growth, Eyes 2025 Growth With Strong TMD Ahead of Investor Day: Analyst

JP Morgan analyst Tien-tsin Huang maintained an Overweight rating on PayPal Holdings, Inc (NASDAQ:PYPL).

PayPal’s fourth-quarter revenue growth of 4% was slightly ahead of JP Morgan and Street expectations and guidance (low-single-digit). The key transaction margin dollar metric was also ahead, up 7% versus JP Morgan and Street estimates of +4% and +3%.

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Gross yields were about in line with expectations, with a transaction take rate of 1.73% versus the JP Morgan and Street estimates of 1.74% and 1.73%. Total Payments Volume (TPV) was up 7% (JP Morgan and Street estimate of +6% and 7%), including Brand volume up 6% foreign-exchange neutral (JP Morgan estimate +7%), stable from last quarter despite accelerating market growth (though management noted that the U.S. did accelerate).

The Payment Service Provider (PSP) volume was +2% (JP ...

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