Is PYPL a good stock to buy? We met the theory of PayPal Holdings, Inc. in High Growth Investing’s Substack by Stefan Waldhauser. In this article, we will summarize the bulls thesis on PYPL. The share of PayPal Holdings, Inc. it was $44.90 as of March 13. PYPL’s trailing and forward IP/E were 8.30 and 8.53 respectively according to Yahoo Finance.
Denies Prykhodov / Shutterstock.com
PayPal Holdings, Inc. uses a technology platform that enables digital payments for merchants and consumers worldwide. PYPL faced a surprising market reaction on February 3, 2026, when it announced a dramatic change of CEO and issued disappointing guidance for 2026. Enrique Lores, former CEO of HP Inc. and Chairman of PayPal’s board, is expected to become CEO on March 1, 2026, with Jamie Miller serving as interim CEO until then.
Read more: 15 AI Stocks That Are Making Investors Quietly Rich Read more: Underrated AI Stock Expects Huge Profits: Potential to Increase 10000%
The board’s decision reflects concerns about the speed of execution under former CEO Alex Chriss, especially in the high-profile exit segment, where growth has slowed and competition from Apple Pay and others. The results of Q4 2025, while slightly below analyst expectations, were not catastrophic: PayPal reported $8.68 billion in revenue (+4%), $475 billion in total payment volume (+9%), $4.03 billion in margin dollars (+3%), and $2.2 billion in free cash flow. Revenue for the full year 2025 reached $33.17 billion (+4%) and $5.6 billion in free cash flow.
The market, however, is focused on the outlook, which shows volatility in the core premium and a slight decline in transaction revenue, causing a massive 20% drop in the stock price and reducing the market capitalization below $40 billion. Despite the selloff, PayPal remains highly profitable, with plenty of cash flow and $6 billion set aside for share buybacks in 2026. At the current valuation, the company is trading at an enterprise value to free cash flow of about 6 times, which means that valuations are depressed.
If the new CEO can stabilize the brand’s exit business while maintaining cash generation, the stock has tremendous potential. Additionally, strategic interest from major players such as Elon Musk’s xAI or OpenAI can provide a choice. With a combination of undervalued fundamentals, strong cash flow, and potential upside, PayPal presents a compelling investment opportunity below $42.
Previously, we included a bullish thesis to PayPal Holdings, Inc. (PYPL) by Sergey in April 2025, highlighting strong execution, Venmo and BNPL growth, AI integration, and $6 billion in acquisitions. PYPL’s stock price is down about 32.29% since our coverage, reflecting investor concerns about the quality of growth, margin erosion from mix shifts, and increasing competition despite strong fundamentals. Stefan Waldhauser has a similar view but emphasizes the CEO change, the weak guidance for 2026, and the payment challenges with a near-term sign, hedging the opportunity for a possible change.
