PayPal Wins A New Bullish Analyst: Bernstein Upgrades To Outperform

Analysts continue to like Paypal Holdings Inc. PYPL's future outlook as Bernstein analyst Lisa Ellis upgraded the stock to Outperform with a price target of $61, raised $15 from the previous target of $46. Ellis believes this is most likely the start of a long and strong positive run for PayPal.

2 Reasons To Be Bullish On PayPal

1. Ellis highlighted a solid long-term business outlook that has recently improved. She specifically noted the growth of the “Pay with PayPal” checkout button, new partnerships and the company's new culture.
2. Ellis sees several positive catalysts ahead for PayPal. She noted the following three possibilities: “a strategic acquisition, the timing of which has likely been made more urgent by the recently announced Vantiv-WorldPay merger and Visa-Klarna minority stake, the pending credit business partnership; and earnings out-performance over the next 3-4 quarters.”

Overall, PayPal investors should watch for “an acquisition announcement (or signs one is forthcoming), and the credit business partnership announcement," Ellis said. For second-quarter earnings, keep an eye on take rates and expense growth.

PayPal shares were up 2 percent during Monday’s pre-market session, driven primarily by Ellis’ upgrade and KeyBanc's initiated coverage on PayPal at Overweight. PayPal reports Q2 earnings on July 20.

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Here's How PayPal Shares Can Hit $63 Gene Munster Says Apple Pay A Legitimate Threat To PayPal's Staying Power _________ Image Credit: By Sagar Savla - Own work, CC BY-SA 3.0, via Wikimedia Commons