© Reuters PayPal (PYPL) cut as Daiwa lowers EPS forecast
PayPal (NASDAQ:) was cut to Neutral from Outperform at Daiwa on Tuesday, with the firm also lowering its price target for the stock to $62 from $64 per share.
Following the company’s earnings release, the firm lowered its forecasts for non-GAAP EPS and is now calling for $5.16 for 2024, down from $5.61. For 2025, they see EPS at $5.56, and for 2026, they expect $6.18.
“With the company’s guidance looking conservative, we see considerable potential for an overshoot, but at this stage, we are lacking the conviction to factor in sharp upside,” said Daiwa analysts. “As such, we intend to closely observe quarterly earnings performance to get a gauge of upside potential.”
Analysts feel it is difficult to envision medium/long-term EPS growth for the company until there is a return to a clear growth trajectory for transaction margin dollars and the benefits from ramped-up investments emerge.
Once those factors fall into place, the firm thinks strong profit growth will be possible for PYPL.
This story originally appeared on Investing
