Whether you put 1,000 euros in PayPal-Shares (WKN: A14R7U) want to invest, that may be another matter. However, it is remarkable how low the stock has fallen. A comparative look at the valuation at record highs reveals this very clearly.
Today, the stock is finally listed at a stock price of 81.62 EUR. At the record high, however, it was 264.45 euros. That would mean that at the time you would have paid 3,240 euros for the same number of shares. That really is a big difference.
Let’s take a look at the PayPal stock today and a first consideration of why the 1,000 EUR invested today may increase in value in the long run.
Investing 1,000 Euros in PayPal stocks today?
The discount is a first reason. Anyone who invests € 1,000 in PayPal shares today will receive the certificates with a discount of around 70%. We can also see this in the comparison value of 3,240 euros, which is a big difference.
But otherwise, the fundamental valuation has changed almost completely. The PayPal stock is now valued at roughly exactly $ 100 billion in market value. Based on the figures for the first quarter, the price-to-sales ratio is thus below 4. The price-to-earnings ratio is also in the value range of 24.6. A crucial point is that this evaluation measure could no longer be quite as realistic.
The US payment service provider is less profitable this year. Instead of earnings per share of over US $ 3.50, at worst it should only be US $ 2.19 in 2022. Nevertheless, volume growth is expected to remain intact with revenue growth of at least 11% in 2022 and growth in payment volume of at least 13%. About 10 million new customers are also expected to join the US group. We therefore recognize that the growth history is in fact operationally intact.
PayPal shares are one of the major technology stocks that have been beaten. Less than a year ago, you would have paid more than € 3,200 for a share package that costs € 1,000 today. This really is a significant difference that opens up for a discount.
It is also noteworthy that quantitative growth continues. Sales, payment volume and user base continue to grow. Only profitability is a construction site in the current financial year. Does it really justify this discount in value? An issue that you as a long-term oriented investor can certainly get to the bottom of.
Our top stocks for 2022
There’s a company whose name gets a lot of buzz from analysts at The Motley Fool these days. It’s for us THE BEST INVESTMENT FOR 2022.
You could also benefit from it. To do this, you must first know all about this unique business. So now we have one free special report prepared, which introduces this company in detail.
Vincent owns shares in PayPal. The Motley Fool owns shares in and recommends PayPal.