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Here's Why PayPal 'Must Gain' 50% Incremental E-Commerce Dollars

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Here's Why PayPal 'Must Gain' 50% Incremental E-Commerce Dollars
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While expressing concern over the competitive landscape for Paypal Holdings Inc (NASDAQ: PYPL), Pacific Crest’s Josh Beck said in a report that the company’s positive near-term momentum was balanced by mid-term risks. The analyst maintained a Sector Weight for the company.

This Is A Must For PayPal

Analyst Josh Beck said that the company must gain ~50 percent of incremental ecommerce dollars. He wrote, “According to our global e-commerce market analysis, excluding China, PayPal must go from ~20% market share in 2014 (i.e., one in five checkout dollars) to ~33% by 2018 (i.e., one in three checkout dollars).”

PayPal is estimated to have gained ~45 percent of incremental e-commerce dollars, excluding currency impact. The company gained a low single-digit percentage share of the global ecommerce market in 2015, “benefiting from ubiquity and significant scale, a trend we expect to persist in the near term,” Beck mentioned.

Over the next couple of years, PayPal merchant services could capture ~50 percent of the incremental global ecommerce dollars, excluding China.

The analyst commented that gaining ~50 percent of incremental ecommerce dollars would require “sustained execution.” He added that in case a competitor gained traction, PayPal’s total payment volume [TPV] growth could be at risk.

Latest Ratings for PYPL

DateFirmActionFromTo
Jan 2017Loop CapitalInitiates Coverage OnHold
Jan 2017BMO CapitalInitiates Coverage OnOutperform
Jan 2017GuggenheimInitiates Coverage OnBuy

View More Analyst Ratings for PYPL
View the Latest Analyst Ratings

Posted-In: Josh Beck Pacific CrestAnalyst Color Reiteration Analyst Ratings Best of Benzinga

 

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