Here's Why Paypal (PYPL) is a Strong Momentum Stock

According to Zacks, PayPal (PYPL) is currently a #3 (Hold) on the Zacks Rank but possesses a VGM Score of A, indicating attractive value, growth, and momentum. Specifically, momentum investors should note PYPL's 'A' Momentum Style Score and recent upward earnings estimate revisions, with 11 analysts raising estimates for fiscal 2025, increasing the Zacks Consensus Estimate to $5.08 per share.

Analysis

PayPal Holdings, Inc. (PYPL) is currently designated with a Zacks Rank #3 (Hold), but exhibits strong underlying financial characteristics, as evidenced by its VGM Score of A. This top grade indicates a favorable combination of value, growth, and momentum. Specifically for momentum-oriented investors, PYPL scores an 'A' in the Momentum Style Score. This is supported by recent positive earnings estimate revisions for fiscal 2025, with 11 analysts upgrading their forecasts in the past 60 days, consequently lifting the Zacks Consensus Estimate by $0.10 to $5.08 per share. Although the stock has seen a marginal price increase of 0.1% over the last four weeks, its consistent historical performance is highlighted by an average earnings surprise of 14%. These factors suggest a positive trajectory in earnings expectations, positioning PYPL as a noteworthy stock despite its neutral overall ranking.

Key Decisions for Investors

• Investors with a momentum focus should consider PYPL for their watchlists, given its 'A' Momentum Style Score and the upward trend in earnings estimate revisions for fiscal 2025.
• The consistent 14% average earnings surprise and the increase in the consensus earnings estimate to $5.08 per share for fiscal 2025 are positive indicators that could signal future outperformance.
• While the Zacks Rank #3 implies a 'Hold' stance, the accompanying 'A' for both VGM and Momentum Style Scores suggests potential upside; therefore, investors should monitor for any upgrades to the Zacks Rank and continued positive estimate revisions before making new investment decisions.