PayPal (PYPL): Expert Call Shows Upside From Visa Relationship - Wedbush

Wedbush analyst, Gil Luria reiterated his Outperform rating on shares of PayPal (NASDAQ: PYPL) and believes that PayPal will remain the commerce payments leader as the partnership with Visa creates unprecedented upside. The analyst hosted an advisor call on the topic of the PYPL/V partnership on Monday July 25th with the former VP of Mobile Payment Solutions at Visa and the former Head of Consumer Products at PayPal.

Panelists confirmed V and PYPL have been in talks regarding a potential partnership for years and that there were benefits for both parties. The narrative that V pushed PYPL into this partnership is incongruent with those facts.

While lowered interchange rates are definitely possible, over time, other aspects of a partnership with V such as access to tokenization, reduced fraud, ability to work with issuers, and access to card art will improve the PYPL user experience, according to panelists. The former Visa executive thought the decision positioned PayPal as part of the future of payments, not allowing other technology companies to benefit from a preference by the networks.

No change to the price target of $50.00 which represents a 30x multiple on 2017 EPS, a 20% premium to V justified by faster and accelerating growth.

For an analyst ratings summary and ratings history on PayPal click here. For more ratings news on PayPal click here.

Shares of PayPal closed at $37.78 yesterday.

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