Stefan Waldhauser
Tech Investor, Co-Founder of StocksGuide
PayPal looks headed for a takeover battle, supporting holding rather than selling near $60. Reuters reports the board will reject the $60.50-per-share offer as insufficient and is considering that other bids may emerge, suggesting a bidding process is being prepared. Block was initially involved but withdrew from the consortium with Stripe and Advent. x.comÂ
PayPal is worth much more than Stripe's reported $53 billion takeover offer, and its board reportedly rejected the bid as inadequate. PayPal makes over $5 billion a year and is growing, buys back about 7% of its shares annually, and traded at just 9x earnings before the news and 11x the offer. $75 a share should be the bare minimum, and a bidding war may follow. x.comÂ
PayPal should hold a floor now that Stripe's dropped $60.50 offer put a value on it, making a return to the $30s unlikely. The very lows should be the low to mid $40s; with nearly 500 million global daily active users, it looks too cheap for an acquirer to pass up, and it could make Elon Musk's X a force. Without more takeover talks, though, it could bleed lower to fill the gap toward its $47 pre-bid price. x.com x.comÂ
PayPal's near-flat growth and rising checkout competition leave it a Grade C, prove-it story. Q3 FY26 revenue rose just 2%; operating income fell 8% as restructuring charges rose from $69 million to $255 million, and net income fell 14%. The business still earns over $1 billion a quarter, but it is treading water. x.comÂ
PayPal's large put-selling accumulation now has an explanation: Stripe and Advent have offered to buy it for $53 billion, per Reuters. The stock also fits a hardware-to-software rotation theme. x.comÂ
PayPal's downside finally looks done after a 10-year round trip, leaving the stock undervalued at a P/E of 8 and a PEG ratio of 0.8. A solid Q2 report could start a recovery back to $60+. x.comÂ
PayPal is better off sold, because management has been unable to use the company's data while Stripe and Advent can. Even at Stripe's $60.50 acquisition price, most PayPal investors will still be in the red; only those all in at the bottom would make about 50%, while most AI names have risen much more. Selling losers is the better path. x.com x.com x.comÂ
PayPal offers a low-probability but very high-reward asymmetric setup, as Stripe's now-dead $60 offer left long-dated options dirt cheap. January 2028 call volatility sits near a historically low 23%, so even a return to average would move premiums sharply. The new CEO's incentives start unlocking at $83 and rise to about $123, with progress likely expected within 12-15 months. A turnaround to $100+ is hard after recent years; the stock sits above key moving averages, near a golden cross. x.com … Show more
PayPal's selloff makes it even more attractive to a strategic buyer. The stock trades at about $5 per share of 2026 EPS guidance, yet is being dumped because the long restructuring timeline leaves "no urgent reason to buy it." x.comÂ
PayPal's cost cuts and reserve releases prop up short-term numbers, while investing for growth wastes time. Its slow bleed gives delusional bulls hope, making it the ultimate value trap; it should not be a public company. x.comÂ
PayPal's beat-and-raise quarter supports the bull case. Per @DeItaone, Q2 EPS was $1.38 versus $1.28 expected, revenue $8.68B versus $8.47B and payment volume $486.5B versus $468.5B, and full-year adjusted EPS guidance rose to about $5.38. PayPal plans $6B of buybacks this year and at least $1.5B of cost savings over 2-3 years, though it expects a low-single-digit decline in Q3 adjusted EPS. x.comÂ