Piper Jaffray Starts PayPal (PYPL) at Underweight; Cites LT Impact from Emerging Competition
Piper Jaffray analyst Gene Munster initiates coverage on PayPal (NASDAQ: PYPL) with a Underweight rating and a price target of $30.00, citing emerging competition long term impact.
Munster commented, "We are initiating on shares of PYPL with an Underweight rating and $30 price target, based our expectations of increased competitive offerings over the next 6-24 months that could put pressure on PYPL's multiple. As Android Pay and Apple Pay gain traction at POS and extend their offerings into the mobile/desktop web payments landscape, we believe consumers will, for the first time, be faced with a real alternative to PayPal. Furthermore, interest in payments from Amazon and Facebook offer further opportunity for digital wallet competitive threats. Near-term we expect PayPal fundamentals to be solid but that over time investors will compress the multiple they're willing to pay for PYPL. Initiate UW, $30 PT based on 12x 2016 EV/EBITDA."
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Shares of PayPal closed at $40.47 yesterday.