Why PayPal Shares Are Plunging Today

PayPal Holdings Inc PYPL is trading significantly lower Wednesday morning after the company announced worse-than-expected fourth-quarter earnings results.

PayPal reported quarterly earnings of $1.11 per share, which came in below the $1.12 estimate. The company reported quarterly revenue of $6.9 billion, which beat the estimate of $6.86 billion.

PayPal said total payment volume reached $339.5 billion in the fourth quarter. 

"The future is moving in our direction, and we are investing in our consumer and merchant capabilities to seize the opportunity in front of us," said Dan Schulman, president and CEO of PayPal.

PayPal said it expects 2022 revenue growth between 15% and 17% and adjusted full-year 2022 earnings to be in the range of $4.60 to $4.75 per share. 

Analyst Assessment: Several analysts weighed in on the stock following PayPal's quarterly results:

• Keybanc analyst Josh Beck maintained PayPal with an Overweight rating and lowered the price target from $250 to $200.
• BTIG analyst Mark Palmer downgraded PayPal from a Buy rating to a Neutral rating.
• Raymond James analyst John Davis downgraded PayPal from an Outperform rating to a Market Perform rating.
• Rosenblatt analyst Sean Horgan maintained PayPal with a Buy rating and lowered the price target from $227 to $216.
• Morgan Stanley analyst James Faucette maintained PayPal with an Overweight rating and lowered the price target from $217 to $190.

PYPL Price Action: PayPal has a 52-week high of $310.16. It's making new 52-week lows Wednesday.

The stock was down 18.8% at $142.88 at time of publication.

Photo: courtesy of PayPal.