On the date of publication, Mark Hake did not hold (either directly or indirectly) any positions in the securities mentioned in this article. Look for the stock to rebound at least 32% to $251.60, and probably much higher if you believe analysts’ targets. In other words, based on both its historical valuation metrics as well as analysts’ price targets, PYPL stock looks very cheap here. This is over 42% higher than yesterday, and well over my price target of $251.60. Similarly, Yahoo! Finance, which uses Refinitiv survey data, shows that 45 analysts have an average target price of $272.38. That is over 40% higher than yesterday’s price. Their survey of 32 analysts is an average target price of $269.07 per share. That is higher than my price target of $251.60 using its historical P/S and historical P/E multiples. That represents a potential upside of 43% over yesterday’s price (Jan. Their average price targets are higher than mine.įor example, Seeking Alpha reports that its survey of 47 analysts results in an average price target of $273.52. Wall Street analysts are also bullish on PYPL stock. It implies an upside of 43.3% over yesterday’s price of $191.14 per share.Īveraging these two, $229.37 using a historical P/S multiple, and $273.83 with a historical P/E multiple, results in a price target of $251.60 per share.
Again, this is well over yesterday’s price.
Given that analysts estimate earnings per share (EPS) of $4., using 59.4 times multiple puts its value at $273.83 per share. Morningstar indicates that its average P/E multiple has been 59.4 times in the last five years. The same can be done using its historical price-to-earnings (P/E) ratio. This puts the target price for PYPL stock at $229.37 per share (i.e., 1.2 x $191.14 price yesterday). That implies a 20% gain over yesterday’s $224.5 billion market value. Moreover, given that analysts now forecast $30.14 billion in sales for 2022, its target market cap for 2022 will be $265.2 billion. That is slightly under yesterday’s market value of $224.5 billion. Seeking Alpha shows that analysts’ sales estimates for 2021 are for an average of $25.35 billion. Given that we are now past 2021, we can use analysts’ estimates for 2021 sales (even though we don’t know the exact number yet). That means that its market cap has typically been over eight times its historical sales. For example, historically in the last five years, it has had an average 8.8 times Price-to-sales (P/S) multiple.
Historical Valuation Estimates for PayPal StockĪs I pointed out in my recent article on PYPL stock in late December, PayPal stock trades below its historical metrics. Let’s look at some reasons why that could be the case.
#Paypal stock price target 2022 upgrade#
The core of his upgrade relates to his view that “valuation risks are now skewed to the upside.” That is analyst-speak for a simplified version of “the stock is cheap.” This is despite the fact that technology stocks have recently been de-rated due to semiconductor chip challenges. He based his recommendation on normalized 2023 estimates, now that the year-end of tax-loss selling seems to be over. 3 that PYPL stock deserves an Outperform recommendation. According to Barron’s, BMO analyst James Fotheringham wrote in a note on Jan. Recently Barron’s reported that an influential analyst has upgraded his view on the stock.
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