Overview
PayPal Holdings Inc has emerged as a potential acquisition target following a decline in its market valuation, according to market-sourced research cited by sell-side firms. Analysts point to current trading levels near seven times consensus 2027 earnings per share as a catalyst for renewed strategic and financial interest in the payments company.
Valuation and asset differentiation
Wolfe Research indicated that while PayPal's consolidated valuation sits at roughly 7 times 2027 EPS estimates, certain assets within the business could command materially higher multiples. The research note suggests products such as Venmo and the company's buy now, pay later operations could fetch premium, potentially double-digit, price-to-earnings ratios in a sale. By contrast, PayPal's Braintree division is expected to attract a distinct valuation multiple, reflecting different growth and margin characteristics.
Value creation pathways
Wolfe framed a strategic acquisition as an opportunity for buyers to drive value through cross-selling into existing customer bases and by realizing cost efficiencies. Within PayPal's portfolio, the unbranded processing unit was flagged as the component most likely to draw competitive interest. The research note also emphasized that PayPal has spent the past two years improving the profitability of its processing business before it returned to growth, which could affect potential bidders' calculations.
Who might bid - and who probably won't
Raymond James assessed the probability of a near-term, whole-company takeover as low. The firm listed several large technology companies as logical strategic suitors, naming Alphabet, Meta Platforms, Microsoft, Amazon, and Apple. Stripe, a private payments company, was singled out as another strategic fit, though Raymond James noted limited publicly available financial information for Stripe, which complicates valuation work.
On the private equity side, Raymond James judged a buyout unlikely, citing an estimated transaction size in excess of $50 billion and an unclear exit pathway for financial sponsors. The firm calculated that a $55 takeout price would imply a mid-teens internal rate of return for a financial buyer. The analysis also acknowledged that prospective acquirers might prefer to pursue individual assets, such as Venmo, rather than seeking to acquire PayPal in its entirety.
Sell-side conviction and competitive positioning
Mizuho reaffirmed an outperform rating on PayPal with a $60 price objective, arguing the stock is deeply undervalued at roughly 7 times 2027 consensus EPS compared with a five-year average in excess of 20 times. The note placed PayPal among the handful of global payments networks, alongside Visa, Mastercard, and American Express, highlighting the company's scale: nearly $2 trillion in processed payment volumes and an active-account base approaching 440 million, encompassing the Venmo peer-to-peer network and a developing buy now, pay later business.
Implications
The sell-side commentary surfaces both strategic and financial routes to capture value from PayPal's current market position, while also flagging practical constraints around deal size and buyer appetite. Market participants will likely track whether interest focuses on discrete assets or the whole company as valuation dynamics evolve.