Hey this is tom, and let's talk about paypal, pypl stock, a full due diligence, deep dive, but as always, the bottom line comes first, i respect your time. I know you got stuff to do so. Here's the bottom line before we dive into the analysis, if you want to stick around for the analysis, why not but check this out number one. I think this is a 300 stock, so, with the current price about 206 dollars, i think it creates a massive opportunity to get this for cheap again.

I think that this company has great margins, great growth and a great overall prospects for the future, including inflationary pressures. I'm gon na explain everything in my analysis, but if that's the only thing you needed, no worries go to town. Go crazy. Do your thing: if you want to stick around pull up a chair, you know, have a beer have a coffee, and let's do this.

So the first thing we're going to do is going to break down the process, how we evaluate companies. Now i use a six prong system number one. I take a look at the business model, the total addressable market, the business number two. I look at the financials of the company to see how strong the balance sheet is.

The cash flow, the total assets, the performance of the company from a financial standpoint number three, the quality of management is it run by ceos that are bozos or superstars number. Four. The moral compass is the company doing shady or productive stuff. I agree with number five: a dcf valuation, i'm gon na run the full dcf on paypal to see what the value is.

I'm gon na tell you right now that the valuation is 300. There's no secrets in this video i'm not holding a hostage and number six, i'm going to look at tip ranks to see what qualified proven analysts are saying about paypal to give us an idea what the comparables are in the market and i'm telling you right now. Everybody's gaga over this company at this price, you're going to see in a second, but before we get started, don't click, nothing, don't smash! Nothing! Don't buy! Nothing! There's nothing to sell here, just your attention! It's the only thing i ask because i want to educate you. That's only thing now make sure you understand this.

What i'm saying in this video is just my opinion. I'm not a financial advisor might be inaccurate might be wrong, it might be literally the ramblings of admin. I had videos like that. You got to do your own research, i'm not just saying this.

This isn't a lip service. Do your own research! If you don't know how ask me below ask me i'll, try to answer and guide you, you have to understand how to do this yourself. This is just an auxiliary. This is just a driver, assist system.

You have to make the decisions yourself. So, let's start with the paypal page on seeking alpha. As you can see right here, the price pre-market is a 211 dollars, as i mentioned in the opener. I think that this is a 300 dollar stock and i think institutional money actually agrees with me because if you take a look at the short interest right here, you're going to see it shorted at six percent.

So, at this price level, at two hundred eight dollars only one point: sixteen percent of smart money is actually shorting paypal. Nobody in his right mind is shorting this pretty much. This is what it says now. What i want you to look at is the financials.

Look. This is a company that presented good numbers across the board for many many quarters, and i think nothing has changed so the revenue growth of the past 10 years has been nothing short of impressive from 5.6 billion to 24.5. You can pretty much say that they've. I guess 5x their revenues in the past nine years, but if you start four years ago in 2017 they started with 13 billion four years later, they're almost at the double amount at 24 and a half just short of doubling revenues in four years.

That's extremely impressive! Now, as far as operating income, obviously you can see this company has been profitable for a long ass time, but look at what happened to the profits. They again double profits in just two years: 2.8 billion in 2019, 4.27 in just two years. But that's not the end of it. Look.

Their numbers are actually very nice on the profitability side as well. Gross margin is almost 50 net. Income margin is 20, which is extremely impressive, 20 cents on the dollar net income margin is not easy to find really good numbers. If you take a look at the growth as well, the growth is there 21, this year, expected to still do 20 next year.

On the revenue side, again, that's not something you find every day with the multi hundred billion dollar company. This is a 200 billion company growing at 20 per year, with good margins and good revenues. That's not something you just find every day. So why is the stock price behaving like this? If you take a look at this chart for the past nine months, they're down 30, while the s p is up about 30.

So what the hell is going on with paypal - and i think it can mainly be attributed to two things - number one - is the whole covert issue. Basically saying well, paypal actually increased during covert everything is reopening. Paypal is going to slow down again, i guess, but i mean nobody said that covert is over and nobody said that people are stopping buying online. So i don't see that narrative really panning out so much there's also a different narrative about paypal, actually disengaging a little bit from ebay with ebay, actually allowing other service providers to be on the platform.

But at this point we're looking at probably five to six percent of the entire paypal business coming from ebay. It's not really a huge deal, while the entire fintech market, especially during inflation, is going to see a huge boost. I think this company is probably the best priced one of them all and at this point let's take a look at the multiples, and i just don't want you to get over focused on these percentages on difference to sector right here, because seeking alpha tends not to Always do the best job with these just look at the absolute numbers. Obviously, this company is not cheap.

I'm going to sit here and say that 50 evie to ebitda is cheap, but it's reasonable, given how good this company is. Ev sales is almost a 10, quite reasonable price to sales is under 10, quite reasonable. I mean ev ebitda crediting 12 months is almost at 50, which is kind of high, but then again again this is a great company. P gap is at 50, nothing cheap, but again, not nothing out of the ordinary.

If you're talking about one of the best companies in this category, if you compare it to companies that are leading their categories, we're going to see much higher multiple, especially in this bullish market - and this is my dcf back from june - i made a video in june. You can go check it out. The same dcf applies to this situation. Nothing really changed.

We're talking about the valuation anywhere between 234 dollars to 430, an average of 331 dollars. Current price is actually much lower than this 289. It's probably 211 right now. So we have much bigger upside at this point, but i think this dcf really is still applicable, especially given.

What i'm about to show you on tip ranks - and this is the main page on tip ranks by the way. If you want to get a 10 discount to tip pranks, there's a link below, if you apply this link, you get a 10 off of the annual subscription. I've been using it and being a paying member. Before i had that link so don't go saying i promote stuff, it's basically a product, i use every single day.

So if you want to help the channel you know you want to get this for yourself, which i think you should. The link is below i'm not going to sell it anything beyond that. So 280 is the aggregate amount of analysts looking at this company, which is nice and dandy about 34 upside, but i am not really obsessed about this number. I want to see what the good analysts are saying, what the qualified five star wants.

So right now, as you can see here, i basically changed it to just five star analysts and if you go down this list of these five-star analysts, let me just show you right now: there's not a single one on this first page, apart from one who sees A four percent downside that doesn't see a huge upside for this company anywhere between 27 and all the way to 56 percent of upside in this range. If you look at josh back, for example, i think george probably is the leading analyst on this list. He's a guy that is ranked 59 in the nation out of 7 756, so you know top one percent and he has people at 325 dollars, which is, i believe, even higher than me, and he's been right, 22 out of 26 times about paypal. 85 of the time, so he knows what the hell he's talking about.

I highly suggest you check out his profile and you check out paypal as well and as always a huge shout out to the channel members and the patreons. If you want to double around with the dcf, we just showed you on the screen right now. This full dcf will be available to download on our patreon page and channel members section. You can go and get it immediately after the video five dollars per month and you become a member of our community or patreon.

It doesn't really matter and you support the channel if you do greatly appreciate it. If you don't no worries just keep watching the videos and enjoy yourself i'll see you tomorrow.