PayPal Holdings Inc (PYPL.O): Can Significant Investment Reverse Slide?

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PayPal Holdings Inc (PYPL.O): Can Significant Investment Reverse Slide?

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06 Jul 2026 19:15:18 ET │ 19 pages

PayPal Holdings Inc (PYPL.O)

Can Significant Investment Reverse Slide?

CITI'S TAKE

PYPL is undergoing major strategic investments to accelerate transaction

margin dollars, but the big question for investors is if this turnaround can be

any different from that of recent years which failed to change the downward Neutral

trajectory of the business. We think technological enhancements Price (06 Jul 26 16:00) US$45.09

underlying PYPL’s modern Branded Checkout and a renewed focus on the

Target price US$48.00consumer can potentially reverse the negative slide in Branded growth with

time. The operating environment in both the US and Europe (Germany and Expected share price return 6.5%

the UK) is likely better vs in recent quarters, but we expect Branded to land Expected dividend yield 1.2%

at the low end of the guided range (1%) in 2Q26, with other metrics feeling

Expected total return 7.7%uneven due to upfront investments still ramping. We anticipate a reiteration

of the annual guide for both TMD (slight decline Y/Y) and Branded TPV (up Market Cap US$39,774M

LSD Y/Y) as the new consumer-facing & internal AI investments gain

ground. Neutral with a $48 PT.

Investing in Branded Checkout is #1 Priority. We believe that PYPL needs to Price Performance

reaccelerate Branded Checkout’s growth in order to re-establish investor (RIC: PYPL.O, BB: PYPL US)

confidence in the power of the organization’s two-sided network, PYPL’s

sustainability of growth, and the company’s ability to defend market share against

rising peers.

n Modern Branded PayPal Checkout Presenting a Right to Win. We believe that

rolling out PYPL’s revamped Branded “modern checkout” platform (desktop and