Goldman Sachs on Monday downgraded PayPal Holdings (PYPL) to sell from neutral on views that the digital payments company will face potential transaction margin pressure in 2026. PayPal stock fell, although the Nasdaq and other stock exchanges rebounded on positive trade news.
On the stock market today, PayPal fell 1.7% to 68.65 in afternoon trading after plunging 7.8% on Friday in the sharp market sell-off. PayPal stock has retreated 20% in 2025.
PayPal Q3 Earnings Report Due Oct. 28
Third-quarter earnings for PayPal stock are due on Oct. 28 before the market open.
Some analysts have lowered expectations heading into the Q3 earnings report amid a temporary service disruption in Germany.
At Jefferies, analyst Trevor Williams also expects financial metrics for PayPal’s branded business to again be a key issue in the Q3 report. Analysts have focused on branded checkout total payment volume growth, for example.
Branded TPV is tied to the online PayPal checkout button that many consumers use when shopping online. The company’s new definition of branded volume now includes “Pay with Venmo.”
On the Q3 earnings call with Wall Street analysts, PayPal may offer preliminary guidance for 2026.
Truist analyst Brian Finneran in a recent report said “Bear case is that PayPal will struggle to grow gross profit at a pace higher than 2% to 3% over the coming years.”
PayPal Stock Technical Ratings
San Jose, Calif.-based PayPal has evolved from an online checkout option to a mobile shopping and person-to-person payments app. It’s pushing further into e-commerce, such as buy now, pay later consumer loans, analysts say.
Further, PYPL stock holds an IBD Composite Rating of 58 out of a best-possible 99, according to IBD Stock Checkup. IBD’s Composite Rating combines five separate proprietary ratings into one easy-to-use rating. The best growth stocks have a Composite Rating of 90 or better.
Also, PYPL stock has an Accumulation/Distribution Rating of B. That rating analyzes price and volume changes in a stock over the past 13 weeks of trading. Its current rating indicates more funds are buying than selling.
The rating, on an A+ to E scale, measures institutional buying and selling in a stock. A+ signifies heavy institutional buying, E means heavy selling. Think of the C grade as neutral.
Follow Reinhardt Krause on X, formerly Twitter, @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
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