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Why PayPal Stock Popped This Morning

By Evan Niu, CFA - Updated Feb 11, 2021 at 3:02PM

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The online payments specialist hosted a virtual investor day and laid out a rosy future.

What happened

Shares of PayPal (PYPL 2.23%) popped as much as 7% this morning as the company hosted a virtual investor day and offered bullish commentary regarding its future. By the close on Thursday, the stock had given up almost all of those gains amid broad market volatility and was up less than 1%.

So what

The online payments specialist said that it expects total payment volume (TPV) to triple by 2025. For reference, PayPal reported TPV of $936 billion for 2020. Active accounts are forecast to jump from 377 million currently to 750 million over the same time frame, as PayPal continues to expand its product offerings to bolster consumer engagement on its platform.

Person holding a phone using the PayPal app

Image source: PayPal.

In particular, PayPal will continue expanding into cryptocurrency services. The company made waves last fall when it announced that it would start supporting the digital assets as a funding source for payments. The launch of cryptocurrency payments on PayPal's Venmo, its popular peer-to-peer (P2P) payment service, is still on track for the first half of 2021. Launching crypto payments in the U.K. is expected to come a few months later.

Now what

CEO Dan Schulman also suggested that PayPal may grow by acquiring or partnering with other companies, while the platform's use cases continue to expand beyond just payments. The chief executive even envisioned consumers using PayPal to invest. Many competing fintechs like Square or SoFi, which is preparing to go public by merging with Social Capital Hedosophia Holdings V, have been building out comprehensive platforms that similarly offer a wide array of financial products and services.

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Stocks Mentioned

PayPal Holdings, Inc. Stock Quote
PayPal Holdings, Inc.
PYPL
$71.40 (2.23%) $1.56
Block, Inc. Stock Quote
Block, Inc.
SQ
$63.90 (3.97%) $2.44
Social Capital Hedosophia Holdings Corp. V Stock Quote
Social Capital Hedosophia Holdings Corp. V
IPOE

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