PayPal has gotten torched over the last six months - since November 2025, its stock price has dropped 33% to $45.03 per share. This may have investors wondering how to approach the situation.
Is there a buying opportunity in PayPal, or does it present a risk to your portfolio? See what our analysts have to say in our full research report, it’s free.
Why Is PayPal Not Exciting?
Even with the cheaper entry price, we're cautious about PayPal. Here are two reasons you should be careful with PYPL and a stock we'd rather own.
1. Lackluster Revenue Growth
Long-term growth is the most important, but within financials, a stretched historical view may miss recent interest rate changes and market returns. PayPal’s recent performance shows its demand has slowed as its annualized revenue growth of 5.3% over the last two years was below its five-year trend. We’re wary when companies in the sector see decelerations in revenue growth, as it could signal changing consumer tastes aided by low switching costs. 
Note: Quarters not shown were determined to be outliers, impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.
2. EPS Barely Growing
We track the long-term change in earnings per share (EPS) because it highlights whether a company’s growth is profitable.
PayPal’s EPS grew at a weak 3.6% compounded annual growth rate over the last five years, lower than its 8.1% annualized revenue growth. This tells us the company became less profitable on a per-share basis as it expanded.
Final Judgment
PayPal’s business quality ultimately falls short of our standards. After the recent drawdown, the stock trades at 8.3× forward P/E (or $45.03 per share). While this valuation is optically cheap, the potential downside is big given its shaky fundamentals. We're pretty confident there are more exciting stocks to buy at the moment. We’d suggest looking at our favorite semiconductor picks and shovels play.
Stocks We Would Buy Instead of PayPal
ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren't just high-quality businesses. Something is happening with them right now. Elite fundamentals meeting near-term momentum - both boxes checked at the same time.
Find out which stocks our AI platform is flagging this week. See this week's Strong Momentum stocks - FREE. Get Our Strong Momentum Stocks for Free HERE.
Stocks that have made our list include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.
