What Made PayPal’s (PYPL, $90.69) Shares Surge More than 24% in 2018?
PayPal Holdings witnessed impressive growth in its user base in 2018, with a reach of 254 million active accounts as reported in its 2018 third quarter earnings.
What enabled this compelling growth?
Paypal's increasing customer base indicates a growing network effect: the more value it has for existing customers, the more new users join in. The more customers use PayPal, the more merchants will feel compelled to accept this as a mode of payment; as more merchants accept this as a mode of payment, the more customers will use this, and in this way the cycle goes on. This rising network effect is evident in the company's third quarter earnings report, in which the average account that had used PayPal is 36.5 times over the last year, a 9.5% year-over-year increase.
This rapid growth in PayPal’s users and sales reflect the company’s unique positioning in digital payments. For example, Apple also has digital wallet called Apple Pay. But if someone wants to direct funds to a friend’s account, that person must also be an Apple user. These limiting factors, also found in Samsung Pay, Alphabet’s Google Pay and Amazon.com’s Amazon Pay, are eliminated by PayPal helped it increase its customer base.
Paypal's third quarter earnings report saw its revenue grow to $3.68 billion, a 14% year-over-year increase, and adjusted earnings per share (EPS) rose to $0.58, a 26% year-over-year increase. PayPal is now set to finish the year with adjusted EPS in a range of $2.38 to $2.40, which would give it an adjusted P/E ratio of 38.1.
PYPL's MACD Histogram just turned positive
The Moving Average Convergence Divergence (MACD) for PYPL turned positive on February 19, 2026. Looking at past instances where PYPL's MACD turned positive, the stock continued to rise in of 49 cases over the following month. The odds of a continued upward trend are .
Technical Analysis (Indicators)
Bullish Trend Analysis
The RSI Indicator points to a transition from a downward trend to an upward trend -- in cases where PYPL's RSI Indicator exited the oversold zone, of 41 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are .
The Momentum Indicator moved above the 0 level on February 19, 2026. You may want to consider a long position or call options on PYPL as a result. In of 93 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where PYPL advanced for three days, in of 298 cases, the price rose further within the following month. The odds of a continued upward trend are .
Bearish Trend Analysis
The Stochastic Oscillator demonstrated that the ticker has stayed in the overbought zone for 10 days. The longer the ticker stays in the overbought zone, the sooner a price pull-back is expected.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where PYPL declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
PYPL broke above its upper Bollinger Band on February 23, 2026. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Aroon Indicator for PYPL entered a downward trend on February 24, 2026. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Seasonality Score of (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (2.165) is normal, around the industry mean (12.546). P/E Ratio (8.806) is within average values for comparable stocks, (20.353). Projected Growth (PEG Ratio) (0.748) is also within normal values, averaging (1.191). Dividend Yield (0.006) settles around the average of (0.268) among similar stocks. P/S Ratio (1.390) is also within normal values, averaging (133.375).
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. PYPL’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating that the returns do not compensate for the risks. PYPL’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 81, placing this stock worse than average.
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General Information
a provider of digital and mobile payments on behalf of consumers and merchants
Industry SavingsBanks
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