Oppenheimer Remains Bullish Ahead of PayPal's (PYPL) 3Q Report
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Oppenheimer reiterated an Outperform rating and $43.00 price target on PayPal (NASDAQ: PYPL) ahead of the company's 3Q earnings report. Oppenheimer estimates 27% total payment volume growth to $88.6B (vs. Street's $88.3B estimate). Revenue is expected to be $2.65B, In line with consensus estimates, and Adjusted EPS of $0.34 (vs. Street's $0.35).
Analyst Glenn Greene commented, "Heading into 3Q16 earnings (Thurs., 10/21, after market close), we affirm our Outperform rating and $43 price target for PayPal. We remain attracted to the company's unique digital payments assets (including Braintree, Venmo, Xoom) and impressive growth profile. We view the recently announced V/MA strategic partnerships as an important validation of PYPL's role in the payments ecosystem, and suspect transaction margin concerns are overblown. Accordingly, we would not preclude that PYPL reiterates its medium-term outlook with earnings. For 3Q16, PYPL expects revenue to grow 19-21% (~17-19% organic, by our estimate) in constant currency to a range of $2.62-2.67B, and adj. EPS in a range of $0.33-0.35. At ~22.5x our FY17E EPS, we believe PYPL shares are attractively valued."
Shares of PayPal closed at $39.48 yesterday.
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