What happened

Shares of PayPal Holdings (PYPL -1.83%) continued their upward trajectory last month, following another stellar earnings report toward the end of July. The stock gained 12.4%, according to data provided by S&P Global Market Intelligence.

To be clear, there was no news out of the company in August. Nonetheless, the stock continued to surge last month as investors are getting increasingly bullish on the long-term prospects of top e-commerce stocks. PayPal's exceptional second-quarter earnings report, as well as the implications of recent acquisitions, gave investors more reasons to jump on board.

Smartphone with PayPal app displayed lying next to a PayPal-branded credit card, a passport, sunglasses, ear buds, and a camera.

Image source: PayPal Holdings.

So what

PayPal's shares began the year flat but started gaining momentum after a string of positive news announcements. After a solid first-quarter earnings report, management made three acquisitions, spending a total of $2.7 billion in just over a month that showed executives are aggressively putting the company's extra cash to work to cement its lead in the global payments market.

The purchase of iZettle over the summer was the most notable of these. It will make PayPal a major player in point-of-sale solutions for small businesses in international markets like Europe and Latin America. Between the month of May and the announcement of second-quarter earnings in late July, the stock gained 22%. 

PYPL Chart

PYPL data by YCharts.

The second-quarter report continued to build investor confidence in PayPal's ability to keep growing at high rates for a long time. Revenue grew 23% year over year, an acceleration over the year-ago quarter's 18%. Even though PayPal is very consistent in its performance, analysts still can't keep up with the company's pace of growth, as PayPal managed to beat Wall Street's already high expectations on the bottom line. Non-GAAP earnings per share climbed 28% to $0.58, beating the consensus analyst estimate by $0.01. 

Now what

It's no wonder investors keep buying PayPal shares. PayPal's accelerating growth over the last year coupled with management proactively going after opportunities to fill out its payments platform positions the company as a force to reckon with in the multitrillion-dollar global commerce market over the long term.