PayPal's (NASDAQ:PYPL) most recent quarter was great, full stop. But investors are even more excited about what's ahead for the electronic payment processor. Motley Fool contributor Matthew Frankel discusses the fintech's latest quarter and it's plans for 2021 with Fool contributors Brian Withers and Brian Feroldi on a Fool Live episode that was recorded on Jan 4.

Brian Feroldi: PayPal. So we are going to get right into it. Matt, you want to go first?

Matthew Frankel: Sure. PayPal earnings were good. Back to you.

Feroldi: [laughs] Great.

Frankel: The quarter was impressive. If you look at the stock price, you probably already could have guessed that. PayPal's statistics are just becoming almost too big to comprehend. They did $277 billion in payment volume in the fourth quarter. That's a run rate of over a trillion dollars a year. This was the company that used to be, like, a niche eBay payment processor.

Brian Withers: E-babies. [laughs].

Frankel: Right. They added 60 million new users this quarter. That's a crazy amount. One hundred seventy-one thousand people joined PayPal every day in 2020 on average. That's pretty crazy.

PayPal grew its payment volume by 31% year over year. That's it's strongest growth rate in history. So not only is PayPal getting bigger, but it's growth is accelerating, at these levels. Can you imagine a trillion dollars is flowing through your networks and your growth is accelerating? That's a pretty crazy statistic.

Twenty-two percent revenue growth year over year. For the full year, they added 73 million net new active users. They now have 377 million active accounts. Twenty-nine million of those are merchants. They grew their earnings 31%, generated $5 billion of free cash flow, so PayPal's not going have to raise capital anytime soon. The 2021 outlook, in my opinion, is what's really moving the stock today.

They are estimating that they're going to add another 50 million accounts next year. So yes, they've got a nice boost from pandemic times. A lot of people joined PayPal because they're shopping online more, for example. But now they're expecting that to continue into 2021. Fifty million is a pretty impressive growth. There expecting total payment volume in the high 20s percentages. They already had about a trillion dollars of annualized volume. They're expecting over 20% growth on that. They're expecting $6 billion of free cash flow next year.

Then there's a few exciting products that either just launched or in the works, like the Venmo credit card, which just came out. The reward structure is really unique. I don't want to get too into it right now. Their buy-now-pay-later service, which, if you look at companies like Affirm which is a buy-now-pay-later company, that in itself is $10 billion business or more if it's successful.

They're launching the ability to pay for goods and services at their 29 million merchants with cryptocurrency in 2021. That's huge. Right now, you could spend cryptocurrency at, like, 10 places. It's really more than that, but when you think of like the big-name retailers that accept cryptocurrency, it's really not that much. So that could be a game-changer, not just for cryptocurrency, but for PayPal user engagement.

When I said their quarter was just really good, [laughs] I really meant that. They had a really fantastic quarter. There's not a whole lot more to say about it. I mean, they knocked out of the park.

Feroldi: Thesis on track? That's what you're saying?

Withers: Matt, is it delivering stuff to the bottom line? Is it getting more profitable with this accelerated revenue growth?

Frankel: Yeah, I mentioned 31% total payment volume growth in 2020, 31% earnings-per-share growth. So it is translating into just as much profitability. It's not like they're investing really heavily and eating into their profits to get that, so it's translating into earnings.

They're expecting further 17% earnings growth next year. Like I said, they've got a nice pop during the pandemic, so that's not really necessarily a growth slowdown as much as it is normalization. PayPal's growing impressively, and it's translating into money in their pockets.

Feroldi: PayPal is now a $308 billion company. That is monstrous, and Mastercard is only $340. So PayPal is within 10% of Mastercard.

Frankel: But remember when PayPal was a tiny subsidiary of eBay? Brian, what's your ticker quote say? How much is eBay worth right now?

Feroldi: eBay has actually been a pretty good investment recently, but eBay is $42 billion.

Frankel: So PayPal is roughly nine times the size of eBay. I used to own PayPal because I got shares in the eBay spinoff. I was a longtime eBay shareholder.

Feroldi: That was like, the, reason to buy eBay. [laughs] Come on, spinoff. [laughs]

Frankel: I thought it was expensive then, and look at it now.

Feroldi: Yeah, [it] is a monster. Just a monster.

Frankel: Wait till they figure out how to monetize Venmo. [laughs]

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.