PayPal stock gains as Michael Burry increases stake
PayPal Holdings Inc. stock gained on Monday after Michael Burry increased his stake, seeing potential in the depressed asset. Analysts have mixed views, with a consensus price target of $65.80. The stock remains in a downtrend but is showing signs of stabilization.
*this image is generated using AI for illustrative purposes only.
PayPal Holdings Inc. stock rose on Monday after disclosures that investor Michael Burry increased his equity stake. The digital payments company has seen its shares tumble from a peak of $300 in 2021 to approximately $43. Burry attributes the recent underperformance to slowing revenue growth, changing profitability profiles, and CEO turnover. However, he sees potential in the depressed asset, stating, "The market has been attending PayPal’s wake for years now, though the body has yet to show."
Burry Accumulates Position
Burry continues to build his position in the fintech giant. His base case suggests PayPal’s consumer brand and discounted valuation could make it a compelling acquisition candidate. This outlook is supported by a Bloomberg report that Stripe considered making a formal bid for PayPal earlier this year.
Analyst Outlook
Analysts hold mixed views on PayPal’s long-term prospects. A consensus price forecast of $65.80 reflects a broad range of opinions. The most bullish forecast comes from Citizens Capital Markets, which projected the stock could reach $125 on Feb. 26, 2025. The most bearish outlook was issued by Morgan Stanley, which set a price forecast of $34 on Feb. 4, 2026.
| Firm | Rating | Price Forecast | Date |
|---|---|---|---|
| Canaccord Genuity | Hold | $42.00 | May 20 |
| Truist Securities | Sell | $44.00 | May 12 |
| Macquarie | Neutral | $50.00 | May 7 |
Technical Analysis
The stock remains in a downtrend, trading about 22% below its 200-day SMA ($55.41). It is also below its 50-day SMA ($46.08) and 100-day SMA ($46.01). Monday’s strength helped it press back toward the 20-day SMA ($43.26), but the near-term trend has not flipped decisively higher. Momentum indicators suggest caution, with MACD below its signal line and a negative histogram.
Key resistance is at $46.50, near the 50-day moving-average zone. Key support is at $38.50, just above the 52-week low of $38.46. PayPal Holdings shares were up 3.82% at $43.12 at the time of publication on Monday.
What specific strategic moves could PayPal's new CEO implement to reverse the slowing revenue growth and changing profitability profiles?
How likely is a potential acquisition by Stripe or another fintech giant given PayPal's current depressed valuation?
What impact could Michael Burry's increased stake have on investor sentiment and PayPal's stock performance in the near term?
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