Digital payment platform PayPal, Inc. (NASDAQ: PYPL) shares have fallen (-62%) during the year and have returned below the lows of the 2020 pandemic. The company enjoyed accelerated growth during the pandemic, but now continues to see its shares deflate after of the pandemic and in a possible global recession. The macro-environment has made it difficult to predict the normalized spending of consumer e-commerce due to geopolitical, inflationary and supply chain pressures. This has caused the company to dampen expectations by reducing advanced guidance. PayPal is a digital transformation aggregator for businesses and consumers, as well as for e-commerce. Online and peer-to-peer (P2P) payments are becoming a crowded space with competitors such as Block (NYSE: SQ), Visa (NYSE: V) and Apple Pay (NASDAQ: AAPL). The company is still increasing its active user base by 429 million and the total volume of payments. Its Venmo (P2P) application also continues to gain popularity as it increases its user base north of the 70 million. It is one of the few fintech that is profitable according to GAAP. The company suspended transactional services in Russia, which affected gains in (-0.03 dollars) per share and enabled shipping and receiving services in Ukraine. The company surpassed the best fiscal quarter of the first quarter of 2021 with revenue growth of 7% to $ 6.5 billion excluding eBay (NASDAQ: EBAY). The Buy Now and Pay Later (BNPL) service increased its volume by 256% to $ 3.6 billion with more than 18 million customer accounts using this feature. Venmo’s volume rose 12% to $ 58 billion. PayPal expects to launch its integration with Amazon.com (NASDAQ: AMZN) during the second half of the year. Prudent investors who have been patiently waiting for the exposure in a leading digital portfolio and payment platform can watch for opportunistic setbacks in PayPal shares.
First quarter 2022 earnings report
PayPal reported its earnings for the first quarter of 2022 for the quarter ended March 2022 on April 27, 2021. The company reported earnings per share (EPS) of $ 0.88, which match the analysts ’estimates of $ 0.88, missing ($ -0.01). Revenue grew 7.7% year-over-year (YoY) to $ 6.5 billion, exceeding consensus analyst estimates of $ 6.4 billion. The total volume of payments (POS) grew 13% to $ 323 billion. The company added 2.4 million new net active accounts (NNA) or 9% to raise its total active accounts to 429 million.
PayPal lowered its EPA target for fiscal year 2022 to $ 3.81- $ 3.93 from analysts ’estimates of $ 4.62. Tax revenue for 2022 is expected to grow from 11% to 13% between $ 28.2 billion and $ 28.7 billion, compared to consensus analysts ’estimates of $ 29.26 billion. This includes the expected drop ($ -725 million) in eBay revenue. The POS is expected to be between 13% and 15%. The company plans to add 10 million children.
PayPal CEO Dan Schulman acknowledged that he took responsibility for the poor trajectory of recent quarters. Changing consumer behaviors through the pandemic and the uncertain macroeconomic environment has been a challenge for visibility. The first quarter was the strongest quarter in history, with revenue growth of 31% and non-GAAP EPS growth of 84%, making it a comparison to the first fiscal quarter of 2022. hard to beat, but managed to beat her by 7%. Non-transaction-related expenses increased 8%. The BNPL service continues to grow generating $ 3.6 billion in volume. The volume of Braintree increased by 61%. Venmo’s volume rose 12% to $ 58 billion, in addition to 63% growth last year. Nearly 50% of their customers have installed the redesigned PayPal digital wallet and these customers typically make 25% more purchase transactions than other PayPal users. Almost 70% of BNPL customers use the digital portfolio. The ARPA digital wallet is twice as large as users who only use the box.
PYPL price trajectories
The use of rifle charts over a weekly and daily time period provides an accurate view of the landscape of PYPL actions. The weekly rifle chart formed a reverse breakdown of the puppy in the $ 123.20 rejection Fibonacci level (fib).. The downward trend of the weekly rifle chart has a 5-day moving average (MA) resistance at $ 73.58, followed by the 15-period MA resistance at $ 83.17. The weekly stochastic twice rejected 20-band break attempts and is falling on all 10 bands. Weekly lower Bollinger Bands (BB) bands are at $ 49.66. The weekly Low market structure (MSL) buys activators in a break through $ 99.43. The daily rifle chart formed a puppy reverse break, but the channel is still adjusted with a 5-period MA down to $ 71.06 and a 15-period MA to $ 72.64. The lowest daily BBs are $ 67.46. The 50-period daily MA overlaps the 50-period MA at $ 77.84. The daily stochastic has a mini puppy reverse slip that tests the band of 30. The daily BBs have been in a compression that precedes an extension of the price range. Prudent investors can look for opportunistic withdrawal entry levels at $ 71.83, $ 63.35 fib, $ 59.86 fib, $ 55.14, $ 50.64 and $ 48.01 fib. Upward trajectories range from $ 91.45 fib to the level of $ 123.20 fib.