PayPal has had a rough stretch, and Wall Street is getting more cautious. Mizuho Financial Group has downgraded PYPL from “Outperform” to “Neutral,” cutting its price target by $10 — from $60 down to $50.
At roughly $50 per share, that new target leaves almost no upside. The downgrade reflects a shift in Mizuho’s view on PayPal’s competitive position, not just near-term numbers.
The trigger? X Money. Elon Musk’s payments platform, expected to launch this April, is being positioned as the financial layer of his “everything app.” It combines payments, digital wallets, and commerce — all inside the X ecosystem.
That’s almost exactly what PayPal and Venmo do. Mizuho flagged X Money as a direct threat to PayPal’s peer-to-peer payments and branded checkout businesses.
X has over 400 million monthly users. That’s a large built-in audience for any financial product from day one. The platform is also expected to introduce cashtags for tracking stocks and crypto, and may pursue a partnership with Visa.
There are also unconfirmed reports that X Money could offer up to 6% yield on user balances — a feature that would put it squarely in competition with mainstream fintech products.
PayPal’s most recent quarterly results didn’t help the mood. The company reported EPS of $1.23 for Q4, falling short of the $1.29 consensus estimate. Revenue came in at $8.68 billion against expectations of $8.82 billion.
Year-over-year revenue was up 4%, but that kind of growth isn’t enough to excite investors when competition is heating up on multiple fronts.
Analysts currently forecast full-year EPS of $5.03 for PayPal. The stock trades at a P/E of 9.39, which is low — but the discount is there for a reason.
Citi and Wells Fargo both maintain Hold ratings on the stock, citing slower growth expectations and market share pressure. Goldman Sachs went further, cutting its price target to $41 and setting a “Sell” rating back in February.
Bank of America started coverage in March with a “Neutral” rating and a $48 target. Among the 45 analysts tracked by MarketBeat, 7 say Buy, 32 say Hold, and 6 say Sell.
Waterfront Wealth Inc. cut its PYPL position by 45.8% in Q4, selling 22,251 shares. Its remaining stake of 26,372 shares was valued at around $1.495 million at quarter-end.
Insider activity has also been on the sell side. Over the past 90 days, company insiders sold 87,608 shares worth approximately $3.83 million. That includes a 54.83% reduction in ownership by insider Suzan Kereere in February, and a 65.95% cut by CAO Chris Natali in March.
Institutional investors still own 68.32% of the stock. Some smaller funds did add modestly to positions in Q3, but the larger moves have leaned toward trimming.
PayPal’s 52-week range runs from $38.46 to $79.50. The stock opened Monday at $50.81, sitting above its 50-day moving average of $44.88 but well below its 200-day average of $55.76.
PayPal also pays a $0.14 quarterly dividend, annualized at $0.56, representing a yield of roughly 1.1%.
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