Shares of PayPal Holdings Inc. (PYPL) are off 1.4% in premarket trading Wednesday after BTIG analyst Mark Palmer cut his rating on the stock to neutral from buy. "While we believe PayPal is a clear beneficiary of the changes in consumer behavior arising from the stay-at-home orders in response to the pandemic, we also think that, with the company's shares trading at 35x the consensus FY22E adjusted earnings per share, the boost provided by the crisis has been largely reflected in its valuation," he wrote, as PayPal shares have doubled from their March lows. The stock is also trading more than 40% above its February high from prior to the COVID-19 outbreak, Palmer said. He said PayPal shares could still have a path to upside if the company were to gain more traction in physical stores, identify a timeline for when Venmo could reach profitability, and execute more mergers on strategic areas like bill payments. The stock is up 78% over the past three months as the S&P 500 [S: SPX] has risen 28%.
-Emily Bary; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
June 24, 2020 09:20 ET (13:20 GMT)
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