It’s important to note that PayPal hasn’t begun to monetize Venmo yet, but when it does the resulting revenue will be quite helpful to PayPal’s balance sheet. Payment volumes at Venmo, which did not begin accepting merchant payments until 2015, grew by 64% in the third quarter of 2019, to $27 billion. PayPal’s recent growth has been greatly due to the massive growth in Venmo, which PayPal acquired in 2012. Even at 20% market share, PayPal would be handling $1.3 trillion in transactions in 2023. PayPal’s share of this is roughly 20%, and given the network effect, its market share should grow in the coming years. And that’s only expected to grow, with the roughly $3.5 trillion in global e-commerce sales in 2019 expected to balloon to $6.5 trillion by 2023. Growth Prospects for PayPalĪs you might guess, by the size of its user base and mobile payments, PayPal is operating in a truly massive global payments ecosystem. This network effect creates a virtuous cycle that’s lifted PayPal’s user base by 16% annually to 295 million as of the third quarter of 2019. At the same time, with more customers using PayPal, it becomes increasingly valuable to merchants. So, as more merchants accept PayPal as a payment method, the platform is increasingly valuable to customers. PayPal’s Network Effectīecause PayPal is a platform-based business, it can see huge benefits from its network effects. This highlights just how strong PayPal is as an electronic payment processor. This volume was generated through over 3.74 billion transactions, which PayPal processed in that period alone. dollars this was a 29 per cent year-on-year growth. In the second quarter of 2020, PayPal’s net payment volume amounted to 221.7 billion U.S. This has made PayPal a leader in the mobile payments industry. The PayPal One Touch feature means users can register their hardware device and make purchases with it at millions of sites with one-click. This has been especially true for mobile purchases, which is the largest growing e-commerce segment. PayPal has also been a boon for merchants, who see increased conversions for customers who use PayPal. This speeds the check out process and makes identity theft less likely. And it has accomplished that by allowing consumers to check out at online sites without entering credit card or banking information. PayPal was launched to make online shopping easier, faster, and more secure. In 2020, PayPal stock nearly doubled going from around $100 to over $200 in November as stay-at-home stocks and those services facilitating them saw amazing gains due to lockdown restrictions. PayPal stock underperformed the underlying Nasdaq in 2019, with PayPal returning 28.6% while the Nasdaq returned 35.2%. 2018 was a consolidation year for the stock, with the stock remaining in a range of $86.32 to $93.44 a share before finishing the year nearly unchanged at $85.75.

From January 2017 to January 2018, PayPal stock went from $40.35 to $86.32 for a gain of more than 100%. Shares remained in a range of $30 to $40 from then until the beginning of 2017 when they finally began to take off in response to significant growth in PayPal’s revenues and profits. PayPal Holdings (NASDAQ: PYPL) debuted on the Nasdaq exchange in July 2015 at $38 a share after being spun off from eBay. Perhaps none so much as PayPal, which has positioned itself to take advantage of this trend long into the future. PayPal StockĪs global societies have been moving away from physical cash and towards digital payment methods in the 21st century, companies that facilitate such payments have benefited greatly. In 2015 PayPal was spun off as an independent entity, and investors have had access to PYPL for stock trading ever since. It was used so heavily on eBay that the company acquired PayPal and made it the official transfer service for eBay in 2002. PayPal grew steadily in the late 1990s but became really popular thanks to its use as a payment facilitator on the auction site eBay. It achieves this by keeping its users’ credit card and bank account numbers from being transmitted over the internet. How PayPal worksĪs well as moving funds more quickly and easily, Paypal also has the goal of making online purchases more secure. By creating an account with PayPal and then connecting a bank account or credit card, users can send and receive money all around the world. The company is involved in facilitating payments and funds transfers for users across the globe. PayPal was created in 1998 as an electronic commerce platform, and ever since going public in 2002, the stock has been a favourite of investors.

Paypal stock