PayPal Likely to Remain in Investment Phase in Fiscal 2027, Operating Leverage Seen in Fiscal 2028, RBC Says

MT Newswires Live10-29 01:05

PayPal (PYPL) is likely to remain in an investment phase in fiscal 2027, with adjusted EPS growth expected in the mid-single digits and operating leverage more likely in fiscal 2028, RBC Capital Markets said.

The investment firm said in a Tuesday note that EU tariff-related headwinds are expected to persist through at least Q4, likely weighing on Branded Checkout.

RBC said the shift toward greater financial services penetration, higher value-added services attach rates in its payment services provider business and increasing monetization of Venmo will be key metrics to watch over the coming quarters.

The brokerage expects fiscal 2026 adjusted EPS of $5.60 and revenue of $34.6 billion, compared with previous estimates of $5.40 and $34.8 billion, respectively. For fiscal 2027, it expects adjusted EPS of $5.88 and revenue of $36.1 billion. It forecasts fiscal 2028 adjusted EPS of $6.55 and revenue of $37.9 billion.

RBC reiterated its outperform rating on PayPal and maintained its $70 price target.

Price: 56.02, Change: -0.07, Percent Change: -0.12

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