Is PYPL a good stock to buy? We came across a bullish thesis from PayPal Holdings, Inc. on Stefan Waldhauser’s High Growth Investing Substack. In this article, we will summarize the bulls’ thesis on PYPL. PayPal Holdings, Inc. stock was trading at $44.90 on March 13. PYPL’s trailing and forward P/E were 8.30 and 8.53 respectively according to Yahoo Finance.
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PayPal Holdings, Inc. operates a technology platform that enables digital payments for merchants and consumers around the world. PYPL experienced a dramatic market reaction on February 3, 2026, when it announced a surprise CEO change and issued disappointing guidance for 2026. Enrique Lores, previously CEO of HP Inc. and chairman of PayPal, will become CEO on March 1, 2026, with Jamie Miller serving as interim CEO until then.
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The board’s decision reflects concerns about the pace of execution under former CEO Alex Chriss, particularly in the high-margin branded payments segment, where growth has slowed and competition from Apple Pay and others has intensified. The results for the fourth quarter of 2025, although slightly below analyst expectations, were not catastrophic: PayPal recorded $8.68 billion in revenue (+4%), $475 billion in total payment volume (+9%), $4.03 billion in transaction margins (+3%) and $2.2 billion in free cash flow. Full-year 2025 revenue reached $33.17 billion (+4%) with $5.6 billion in free cash flow.
However, the market focused on the future outlook, which indicates a stagnation in core payment volumes and a modest decline in transaction revenue, causing a sharp 20% drop in the share price and reducing the market capitalization to below $40 billion. Despite the liquidation, PayPal remains highly profitable, with substantial cash flow and $6 billion earmarked for share buybacks in 2026. At the current valuation, the company trades at an enterprise value to free cash flow multiple of about 6, implying distressed pricing.
If the new CEO can stabilize the cash register business while maintaining cash generation, the stock has significant growth potential. Additionally, strategic interest from major players such as xAI or Elon Musk’s OpenAI could offer optionality. With a combination of undervalued fundamentals, strong cash flows, and potential catalysts, PayPal presents an attractive investment opportunity below $42.
Previously, we covered a bullish thesis on PayPal Holdings, Inc. (PYPL) by Sergey in April 2025, highlighting strong execution, Venmo and BNPL growth, AI integration, and $6 billion in buybacks. PYPL’s share price has depreciated approximately 32.29% since our coverage, reflecting investor concerns over quality of growth, margin dilution due to mix changes and increasing competition despite strong fundamentals. Stefan Waldhauser shares a similar view, but emphasizes the CEO change, weak 2026 guidance and near-term brand pay challenges, framing a potential turnaround opportunity.