Jefferies Reiterates Buy on PayPal (PYPL) as Venmo Gains Popularity
Jefferies reiterated a Buy rating and $44.00 price target on PayPal (NASDAQ: PYPL) as the company's Venmo product gains popularity. PYPL announced on the latest earnings call they are starting a pilot this quarter to enable PYPL merchants with a "Pay With Venmo" button. By the end of 2016, all Venmo users are expected to have the capability to buy from any of PYPL's ~10M merchants.
Analyst Jason Kupferberg commented, "In recent years, PYPL's Venmo product has become a very popular person-toperson (P2P) payments app, especially among millennials, but to date has not been monetized. On the latest earnings call, PYPL outlined plans to enable Venmo users to shop at PYPL's ~10M merchants by the end of 2016. Our scenario analysis suggests these efforts could be accretive to 2017 EPS by about 1-4%. Maintain Buy and our positive thesis (scarcity value, incumbency, growth strategy)."
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Shares of PayPal closed at $36.21 yesterday.