Key Takeaways
- PayPal is up 36% since June 30, the best of the seven stocks David Einhorn’s Greenlight Capital bought or added to in the second quarter.
- Even after that run, PayPal trades at 10x forward earnings, well below its five-year average, so it isn’t too late to follow him.
- Analysts’ average price target sits below the stock, and the checkout button that earns over half of PayPal’s profit is still growing just 1% to 2%.
- Viatris has run too, while Antero Resources, Core Natural Resources and Primo Brands have lagged, and Greenlight’s next 13F is due by Nov. 16.
David Einhorn’s Greenlight Capital has until Nov. 16 to file its next 13F, which will show what it held on Sept. 30. Its last one, for the quarter ended June 30 and filed Aug. 14, showed seven stocks it bought or added to. The best of them, PayPal (PYPL), is up 36% since June 30.
That 36% is the stock’s move from its June 30 close to Tuesday’s. A 13F doesn’t show what Greenlight paid, or whether it still owns the shares, so it says nothing about the fund’s own return.
The rest of the buys have done less. Viatris (VTRS) is up 31%, Antero Resources (AR) is up 7%, Core Natural Resources (CNR) is up 4% and Primo Brands (PRMB) is down 2%. Dauch, the worst of the seven, is down 18%.
PayPal beat its own forecast
PayPal was new to Greenlight’s 13F at June 30: 1.42 million shares worth $62 million, 1.6% of its 13F stocks. Third-quarter adjusted EPS rose 8% to $1.45. That beat both management’s guidance for a small decline and the $1.31 analysts expected, even though revenue of $8.58 billion missed the $8.71 billion consensus. Management raised its 2026 outlook to EPS of about $5.60. It now expects more than $700 million of run-rate savings to be in place by the end of the year, up from about $400 million. Non-GAAP operating income grew 3% in the quarter, after falling 8% in the second.
TIKR tracks 43 analysts on PayPal. How many say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on PayPal, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See PayPal’s Analyst Ratings
The valuation still backs Einhorn
Analysts expect PayPal’s normalized EPS to keep rising, from $5.31 in 2025 to $6.41 in 2028:
This year’s consensus rose to $5.58 from $5.39 before the third-quarter report, in line with management’s raised outlook. Part of that growth comes from buybacks. Diluted shares fell to 882 million in the second quarter from 977 million a year earlier, and PayPal bought back $6 billion of stock over the 12 months through September.
Even after the run, PayPal trades at 10x forward earnings. Its five-year average is 15x, and its five-year low was 7.3x in February:
Wall Street is less convinced. The consensus price target fell from $83 a year ago to a low of $51 in July, and it now sits at $57, 3% below Tuesday’s close:
The 43 analysts who cover PayPal have targets from $36 to $80. Barclays downgraded the stock to Underweight on Oct. 29, citing slowing fundamentals. Branded checkout is the PayPal button, and management said in February that it earns over half the company’s profit dollars. It grew just 1% to 2% again in the third quarter.
Analysts see more upside in the rest
If you’d rather follow Einhorn into a stock the Street likes better, the rest of his buys offer that. Antero Resources, where Greenlight nearly doubled its stake, has an average target 35% above Tuesday’s close. Core Natural Resources is Greenlight’s third-largest holding at 4.7% of its 13F stocks. Its average target is 33% above the price, though only four analysts cover it. Primo Brands, new to the 13F like PayPal, has an average target 17% above its price. Viatris, where Greenlight added 53% to its stake, closed at a 52-week high on Tuesday, and its average target is just 0.7% above.
Still worth following
Here’s where I land: it isn’t too late to follow Einhorn into PayPal. The stock trades at 10x forward earnings, estimates are rising and buybacks shrink the share count every quarter, so it’s priced for very little. The third quarter showed that the savings can reach operating income. I think PayPal can keep climbing as long as branded checkout holds its ground.
Greenlight’s next 13F, due by Nov. 16, will show whether Einhorn still held PayPal on Sept. 30. PayPal’s fourth-quarter report in early February will bring its first 2027 outlook, after management called next year an investment year.
So what is PayPal stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
