Why Elliott Management's PayPal Stake, New CFO Are Turning This Analyst Bullish

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PayPal Holdings Inc PYPL holds the potential for upside to consensus estimates that's driven by additional cost efficiencies and share buybacks, according to a BofA Securities analyst. 

The PayPal Holdings Analyst: Jason Kupferberg upgraded PayPal Holdings from Neutral to Buy and raised the price target from $94 to $114.

Related Link: PayPal Analysts Increase Price Targets Following Earnings Report, Elliott Management's $2B Investment

The PayPal Holdings Takeaways: Initiatives by activist investor Elliott Management are likely to drive the company’s performance higher, Kupferberg said in the Wednesday upgrade note.

“PYPL’s new CFO, Blake Jorgensen, has a track record of executing well on cost/margin initiatives,” the analyst said. 

Check out other analyst stock ratings.

“Based on potential $5+ of EPS power next year, PYPL trades at 18.4x P/E, which in our view represents attractive risk/reward, as Elliott’s involvement likely provides support to the stock,” he said. 

“Potential catalysts include 2H top-line re-acceleration and 1Q23 Analyst Day, where we expect PYPL will discuss more detailed multi-year capital deployment strategy, reflecting increased return of cash to shareholders,” Kupferberg said. 

PYPL Price Action: Shares of PayPal Holdings were trading 2.95% higher at $94.51 midday Wednesday. 

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Posted In: Analyst ColorUpgradesPrice TargetAnalyst RatingsBofA SecuritiesJason Kupferbergpayments
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