Nonetheless, PayPal operates in an extremely competitive market. This should hopefully lead to higher revenue per customer over time. And with less than 50% consumer penetration in major markets like the U.S., Canada, and Germany, there's a lot of potential. The leadership team took back its prior target of hitting a whopping 750 million active accounts by 2025, and it is now entirely focused on attracting higher-value users who transact with PayPal's services frequently. And over the past three years (2019, 2020, 2021), annual revenue and earnings growth have averaged 18% and 23%, respectively. As of June 30, the company counted 429 million active accounts, which was up 6% from the prior-year period and 50% from the second quarter 2019. PayPal is still firmly in growth mode as a business. In PayPal's case, it is definitely in a strong enough position that it should have no problem handling the near-term headwinds. Companies across the economy have to deal with surging inflation, higher interest rates, and more budget-conscious consumers. It should ease investor worries that these macro issues aren't specific to PayPal's business. Cost cuts of $900 million this year will certainly help to achieve the profit target. It did, however, raise full-year 2022 guidance for adjusted earnings per share to come in at $3.92 at the midpoint.
That means you want to buy stocks with a Zacks Rank #1 or #2, Strong Buy or Buy, which also has a Score of an A or a B in your personal trading style.As a result, management has been forced to lower 2022 revenue guidance twice due to the softening environment, and now expects sales to rise 10% year over year. As you might remember from your school days, an A, is better than a B a B is better than a C a C is better than a D and a D is better than an F.Īs an investor, you want to buy stocks with the highest probability of success. Within each Score, stocks are graded into five groups: A, B, C, D and F. There's also a VGM Score ('V' for Value, 'G' for Growth and 'M' for Momentum), which combines the weighted average of the individual style scores into one score. The scores are based on the trading styles of Value, Growth, and Momentum. It allows the user to better focus on the stocks that are the best fit for his or her personal trading style. The Style Scores are a complementary set of indicators to use alongside the Zacks Rank.
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