PYPL: Early 2023 Clues Are Positive

Jan 08, 2023

Paypal Holdings Inc. (PYPL) may have had a dismal end to 2022 after end-of-year tax-loss selling sent shares tumbling nearly 30%…

But that didn’t stop the digital wallet provider from coming out of the gate strong in 2023.

On Tuesday, the first trading day of the year, PYPL was one of the leading gainers in the S&P 500 despite the Nasdaq turning negative early in the day. And it was able to continue that outperformance through Friday.

This could be a clue that institutions are looking at that recent sell-off as overdone — potentially making PYPL an attractive “value” play for investors to kick off the new year.

Of course, when we spot a clue like that, we have to investigate further…

So we turned to LikeFolio’s powerful brand mapping database to bring you actionable, data-driven insights that will keep you ahead of the curve on PYPL.

Here’s what we found…

Insight No. 1: PayPal Mentions Surging to All-time Highs

PayPal mentions surged in October 2022:

To be fair, all that buzz spiked when consumers became aware of a PayPal policy related to the promotion of “misinformation” and subsequently-imposed fees.

This chatter died down by early November and sentiment normalized around the same time, as it turned out to be nothing more than a flash-in-the-pan reaction to the policy.

Now, consumers are talking about PayPal and its brands, including the popular Venmo app, at a growing clip: Mention volume is up 20% quarter-over-quarter (QoQ) and nearly 50% year-over-year (YoY).

Insight No. 2: Users Remain Relatively Happy with PayPal Products

In the aftermath of that “misinformation” scandal, PayPal’s consumer happiness levels are reverting back to their old, fairly stable levels in the high-60% range:

Insight No. 3: Venmo Just Keeps Growing

As for Venmo, the PayPal-owned brand continues to see worldwide growth, with global unique visitors to its website reaching new all-time highs in Q4 of 2022:

Insight No. 4: The “Digital Wallet” Boom Is Taking a Breather

Like many COVID-era trends, consumer interest in digital wallets has pulled back from early 2022 peaks.

But zoom out, and we can see that interest is still riding a strong multi-year uptrend that should continue throughout the current decade.

The Bottom Line

So, what does all this mean for PYPL as a potential “value” play?

Looking ahead, PayPal’s renewed consumer interest and rebounding sentiment are promising signs for the stock.

Watch for when the company reports earnings for the period ended Dec. 31 in about a month. No official date has been announced yet for when the report will drop, but initial data looks strong.

We’ll continue to monitor PayPal’s strength with consumers and investors over the next few weeks, and as always, LikeFolio members will be the first to know when we spot a big opportunity — on earnings or otherwise.