{"id":479339,"date":"2022-07-30T03:18:00","date_gmt":"2022-07-30T00:18:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/earnings-outlook-is-paypal-about-to-cut-its-forecast-yet-again\/"},"modified":"2022-07-30T03:18:00","modified_gmt":"2022-07-30T00:18:00","slug":"earnings-outlook-is-paypal-about-to-cut-its-forecast-yet-again","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/earnings-outlook-is-paypal-about-to-cut-its-forecast-yet-again\/","title":{"rendered":"#Earnings Outlook: Is PayPal about to cut its forecast yet again?"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3bb9d027e37\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3bb9d027e37\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/earnings-outlook-is-paypal-about-to-cut-its-forecast-yet-again\/#%E2%80%9CEarnings_Outlook_Is_PayPal_about_to_cut_its_forecast_yet_again%E2%80%9D\" >&#8220;Earnings Outlook: Is PayPal about to cut its forecast yet again?&#8221;<\/a><ul class='ez-toc-list-level-2' ><li class='ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/earnings-outlook-is-paypal-about-to-cut-its-forecast-yet-again\/#PayPal_earnings_preview_Analysts_are_split_on_whether_they_expect_payments_giant_to_lower_revenue_forecast_for_the_third_time_this_year\" >PayPal earnings preview: Analysts are split on whether they expect payments giant to lower revenue forecast for the third time this year<\/a><ul class='ez-toc-list-level-6' ><li class='ez-toc-heading-level-6'><ul class='ez-toc-list-level-6' ><li class='ez-toc-heading-level-6'><ul class='ez-toc-list-level-6' ><li class='ez-toc-heading-level-6'><ul class='ez-toc-list-level-6' ><li class='ez-toc-heading-level-6'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/earnings-outlook-is-paypal-about-to-cut-its-forecast-yet-again\/#What_to_expect\" >What to expect<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-6'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/buradabiliyorum.com\/en\/earnings-outlook-is-paypal-about-to-cut-its-forecast-yet-again\/#What_else_to_watch_for\" >What else to watch for<\/a><\/li><\/ul><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/buradabiliyorum.com\/en\/earnings-outlook-is-paypal-about-to-cut-its-forecast-yet-again\/#Emily_Bary\" >Emily Bary<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h1><span class=\"ez-toc-section\" id=\"%E2%80%9CEarnings_Outlook_Is_PayPal_about_to_cut_its_forecast_yet_again%E2%80%9D\"><\/span>&#8220;Earnings Outlook: Is PayPal about to cut its forecast yet again?&#8221;<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<h2 class=\"article__subhead\" itemprop=\"alternativeHeadline\"><span class=\"ez-toc-section\" id=\"PayPal_earnings_preview_Analysts_are_split_on_whether_they_expect_payments_giant_to_lower_revenue_forecast_for_the_third_time_this_year\"><\/span>\n  PayPal earnings preview: Analysts are split on whether they expect payments giant to lower revenue forecast for the third time this year<br \/>\n<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><\/p>\n<div class=\"column column--full article__content\">\n<div class=\"article__side\">\n<div class=\"container--sticky not-active\">\n<div id=\"cx-next\" data-nosnippet>\n              <\/div>\n<\/p><\/div>\n<\/p><\/div>\n<div id=\"js-article__body\" class=\"article__body article-wrap at16-col16 barrons-article-wrap\" itemprop=\"articleBody\" data-sbid=\"WP-MKTW-0001072088\" role=\"document\">\n<div class=\"barrons-article-ad-wrapper\">\n<div data-track=\"barrons-article-ad-wrap\" class=\"barrons-article-ad sticky_item\">\n<div class=\"barrons-main-article-ad-target sticky_target body_ad\" aria-hidden=\"true\"><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<div data-layout=\"\n                inline\" data-layout-mobile=\"\" class=\"\n          media-object\n          type-InsetArticleReader\n              \n              inline\n  article__inset\n          article__inset--type-InsetArticleReader\n              article__inset--inline\n  \"><\/p>\n<div class=\"media-object-article-reader\">\n<div class=\"audioplayer\" data-sbid=\"WP-MKTW-0001072088\" role=\"region\" aria-label=\"Listen to Article\" tabindex=\"-1\" id=\"articlereader\" data-show-title=\"false\" data-theme=\"wsj-article-reader\" data-show-header=\"false\" data-show-subscribe=\"false\" data-ads-enabled=\"true\" data-save-publication=\"false\">\n        <\/div>\n<\/p><\/div>\n<\/p><\/div>\n<p>       PayPal Holdings Inc. has been bringing down expectations all year. Is the company done yet?<\/p>\n<p> Executives in November shared a rough prediction for 18% revenue growth this year, but they lowered that estimate to 15% to 17% in January. Then in April, they trimmed the forecast to 11% to 13% growth. That\u2019s not to mention PayPal\u2019s<br \/>\n        PYPL,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/208054269\/composite\" class=\"positive\">+0.78%<\/bg-quote><br \/>\n       withdrawal of its medium-term outlook, which targeted a 20% compound annual growth rate on revenue over a five-year span. <\/p>\n<div class=\"paywall\">\n       Bernstein analyst Harshita Rawat wonders if another cut to PayPal\u2019s revenue guidance is in store when the company posts results Tuesday afternoon. She noted that PayPal executives have most recently called for 15% to 17% revenue growth when excluding impacts from eBay Inc.<br \/>\n        EBAY,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/204653455\/composite\" class=\"positive\">+0.87%<\/bg-quote><span>,<\/span><br \/>\n       which has been in the process of migrating to its own managed-payments system. That latest forecast is below the 19% to 21% that the management team had been predicting at the start of the year. <\/p>\n<p>But even the new forecast \u201clooks rather rosy against a backdrop of worsening e-commerce trends, uncertain macro, persistent inflation and strengthening dollar,\u201d Rawat wrote. \u201cWe believe it is likely that we see another guidance cut.\u201d<\/p>\n<p>How PayPal shares would react to such a move \u201cis another matter,\u201d she wrote. \u201cWe are inclined to believe that a guidance cut might be dealt with gently by investors and intact guidance\/numbers beat could be handsomely rewarded (in the stock).\u201d <\/p>\n<p>PayPal shares traded more than 11% higher following the company\u2019s most recent earnings report, which brought lowered guidance and the termination of the medium-term outlook. And the stock is fresh off its best month since May 2020, despite some downbeat signals about the strength of e-commerce growth. Helping matters is that activists at Elliott Management reportedly took a stake in the company. <\/p>\n<p><strong>See also: Shopify stock sinks amid layoff plan as CEO admits, \u2018I got this wrong\u2019<\/strong><\/p>\n<p>Jefferies analyst Trevor Williams was more optimistic than Rawat about the prospect that PayPal could maintain its prior revenue forecast, though he was hardly effusive. In his view, PayPal\u2019s latest outlook \u201cbuilt in enough cushion for incrementally weaker trends,\u201d which lowers the odds of a further reset. <\/p>\n<p>An \u201cin-line print and preserving the low-end of guidance is probably good enough, but don\u2019t expect renewed enthusiasm,\u201d Williams wrote.<\/p>\n<p>Barclays analyst Ramsey El-Assal deemed PayPal\u2019s recent guidance changes \u201cpragmatic\u201d given economic pressures, though he said he believed that \u201cthe buy-side is not entirely convinced\u2014given the difficult macro environment\u2014that PYPL won\u2019t need to recalibrate numbers again.\u201d<\/p>\n<div id=\"cx-membership-tile\"><\/div>\n<p>Investors have been \u201clargely on the sidelines\u201d when it comes to PayPal, and El-Assal thinks \u201cthe Street will become more constructive after the company\u00a0consistently meets shorter-term goals over multiple quarters.\u201d<\/p>\n<h6><span class=\"ez-toc-section\" id=\"What_to_expect\"><\/span>What to expect<span class=\"ez-toc-section-end\"><\/span><\/h6>\n<p><strong>Revenue: <\/strong>Analysts tracked by FactSet expect PayPal to report revenue of $6.78 billion, up from $6.24 billion a year before. According to Estimize, which crowdsources projections from hedge funds, academics, and others, the average estimate calls for $6.8 billion. <\/p>\n<p><strong>Earnings:<\/strong> The FactSet consensus models a decline in adjusted earnings per share to 87 cents from $1.15. Those polled by Estimize are looking for 88 cents a share on average. <\/p>\n<p><strong>Stock movement:<\/strong> PayPal shares have declined following three of the company\u2019s last four earnings reports. They\u2019ve also made double-digit moves following the past three reports. <\/p>\n<p>The stock has had a difficult year, falling 54.1% so far in 2022, compared with a 13.3% decline for the S&amp;P 500<br \/>\n        SPX,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/210599714\/realtime\" class=\"positive\">+1.42%<\/bg-quote><br \/>\n       over the same span. <\/p>\n<p>Analysts remain largely bullish on the name. Of the 50 analysts tracked by FactSet who cover PayPal, 35 have buy ratings, 14 have hold ratings, and one has a sell rating. The average price target is $109.38. <\/p>\n<h6><span class=\"ez-toc-section\" id=\"What_else_to_watch_for\"><\/span>What else to watch for<span class=\"ez-toc-section-end\"><\/span><\/h6>\n<p>RBC Capital Markets analyst Daniel Perlin sees a variety of puts and takes headed into Tuesday\u2019s report. <\/p>\n<p>\u201cOn the [positive] side of the ledger, we believe higher interest rates could provide upside to its float portfolio, strength in <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/trip-and-travel\/\" data-internallinksmanager029f6b8e52c=\"10\" title=\"Trip &amp; Travel\" target=\"_blank\" rel=\"noopener\">travel<\/a> bookings remains healthy, and focus on engagement could offer some proof-points this quarter, he wrote. \u201cOn the flipside, the [negatives] include greater FX [foreign-exchange] headwinds, inflationary pressures,\u201d as well as potential discretionary spending issues for lower-income customers and a less robust trajectory for the e-commerce category in the short run.  <\/p>\n<p><strong>Read: PayPal is \u2018one of the more recession-sensitive names\u2019 in payments, analyst says in downgrade<\/strong><\/p>\n<p>PayPal surprised Wall Street earlier this year when executives said they would de-emphasize growth in net new active accounts, which had been a key metric for the company. While PayPal would still look to bring in new accounts, executives would focus more on driving additional activity among higher-value users rather than motivating less engaged ones to stay on board. <\/p>\n<p>Though El-Assal of Barclays said that user growth for PayPal isn\u2019t strongly correlated with growth in its payment volumes, he thought that nonetheless \u201cinvestors should be prepared for Q2 account growth in the mid-single digits vs. ~9% in 1Q22 and midteens growth throughout FY21.\u201d<\/p>\n<p>Another factor to watch will be the performance of PayPal\u2019s buy-now-pay-later offerings. <\/p>\n<p><strong>Don\u2019t miss: PayPal expands BNPL offerings with monthly-payment option<\/strong><\/p>\n<p>\u201cPayPal\u2019s Pay in 4 has seen limited growth among the checkout pages of the merchants we track, and when we looked across players, we found that 28% of Pay in 4 merchants also accepted another BNPL provider,\u201d Morgan Stanley\u2019s James Faucette wrote. \u201cWe think it probably makes sense for PYPL to work toward integrating other BNPL options (Affirm<br \/>\n        AFRM,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/223715966\/composite\" class=\"positive\">+3.91%<\/bg-quote><span>,<\/span><br \/>\n       Klarna, etc.) into its branded checkout option.\u201d<\/p><\/div>\n<\/div><\/div>\n<p><\/p>\n<div class=\"byline article__byline\">\n<p>    <span>By<\/span><\/p>\n<div class=\"author mobile-scrim hasMenu\" data-scrim='{\"type\":\"author\",\"header\":\"Emily Bary\",\"subhead\":\"The Wall Street Journal\",\"list\":[{\"type\":\"link\",\"icon\":\"bio\",\"url\":\"https:\/\/marketwatch.com\/author\/emily-bary\",\"text\":\"Biography\"},{\"type\":\"link\",\"icon\":\"twitter\",\"url\":\"https:\/\/twitter.com\/emilybary\",\"text\":\"@emilybary\"},{\"type\":\"link\",\"icon\":\"email\",\"url\":\"http:\/\/www.marketwatch.com\/news\/mailto:ebary@marketwatch.com\",\"text\":\"ebary@marketwatch.com\"}]}' itemscope itemprop=\"author\" itemtype=\"http:\/\/schema.org\/Person\">\n              <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/marketwatch.com\/author\/emily-bary\" aria-label=\"Emily Bary author page\"><\/p>\n<h4 itemprop=\"name\"><span class=\"ez-toc-section\" id=\"Emily_Bary\"><\/span>Emily Bary<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p><\/a><ufc-follow-author-widget product=\"marketwatch\" author-id=\"213_MW\" author-name=\"Emily Bary\" signin-url=\"https:\/\/accounts.marketwatch.com\/login?target=https%3A%2F%2Fwww.marketwatch.com%2Fstory%2Fis-paypal-about-to-cut-its-forecast-yet-again-11659140326%3Frss%3D1%26siteid%3Drss\" panda-api=\"https:\/\/follow-api.marketwatch.com\"><\/ufc-follow-author-widget><\/p><\/div>\n<\/div>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/news\/\" target=\"_blank\" rel=\"noopener\">News category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"http:\/\/www.marketwatch.com\/news\/story.asp?guid=%7B20C06575-04D4-B545-7105-BD8CA1720545%7D&#038;siteid=rss&#038;rss=1\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;Earnings Outlook: Is PayPal about to cut its forecast yet again?&#8221; PayPal earnings preview: Analysts are split on whether they expect payments giant to lower revenue forecast for the third time this year PayPal Holdings Inc. has been bringing down expectations all year. Is the company done yet? Executives in November shared a rough prediction&#8230;<\/p>\n","protected":false},"author":1,"featured_media":479340,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.mktw.net\/im-594346\/horizontal","fifu_image_alt":"","footnotes":""},"categories":[70897],"tags":[],"class_list":["post-479339","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/479339","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=479339"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/479339\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/479340"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=479339"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=479339"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=479339"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}