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How Will PayPal Grow?

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In a report published Monday, Susquehanna analysts maintained a Positive rating on eBay Inc (NASDAQ: EBAY), with a price target of $75, following a meeting with PayPal CEO Dan Schulman, CFO Patrick Dupuis, and IR Directors Tom Hudson and Tracey Ford.

"The CEO articulated his view that as the financial services industry undergoes technological reinvention, PayPal will press their lead through software capabilities and engineering," the analysts said.

Although PayPal has 10 million merchants, Schulman is focused on getting some big additional merchants. "He is using direct sales to message the PayPal value proposition into the large merchants - a better mobile software gateway in PayPal Braintree, a superior security solution with PayPal pattern recognition, and 165 mln dedicated users," the analysts added.

With mobile taking a lead in payments, Schulman indicated that PayPal could be "a friend to the merchant through this transition." The CEO noted, however, that industry data indicates a decline in conversion rates when consumers shift to mobile. "Braintree by contrast helps lift mobile conversion, and is the toolkit for PayPal to close merchants looking for a mobile payments solution," the analysts wrote.

In the report Susquehanna noted, "eBay will report 2Q in July. While there is no specific timeframe, based on the cadence of other spins relative to rebalances, we would anticipate a spin in potentially early Q3."

Latest Ratings for EBAY

DateFirmActionFromTo
Jun 2017Credit SuisseAssumesOutperform
Apr 2017Monness Crespi HardtDowngradesBuyNeutral
Apr 2017ArgusMaintainsBuy

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Posted-In: SusquehannaAnalyst Color Reiteration Analyst Ratings

 

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