- Morgan Stanley analyst James Faucette thinks e-commerce growth probably needs to normalize before investors can turn positive on PayPal Holdings, Inc PYPL.
- Faucette had an Over Weight with a price target of $129.
- Data from the MS Proprietary acceptance tracker supports his view that PYPL's wide acceptance lead and growing merchant share (especially among large sellers) can help it keep growing faster than e-commerce.
- Also Read: Wells Fargo Sees Tricky Q2 For PayPal Amid Subdued Broader E-Commerce Growth, Inflation; Cuts Price Target By 16%
- He notes that Pay with Venmo acceptance stood at just 3% by count in 2Q.
- However, Faucette adds that exposure through Amazon.com Inc AMZN, where it should become available in 2H, and its reach to 85 million young consumers should support Venmo's further expansion among merchants.
- Faucette thinks that it probably makes sense for PYPL to work toward integrating other BNPL options like Affirm Holdings, Inc AFRM and Klarna into its branded checkout option.
- Price Action: PYPL shares traded higher by 2.32% at $82.10 on the last check Thursday.
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