PayPal continues incredible 15-quarter earnings run
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PayPal continues incredible 15-quarter earnings run

Online payments giant PayPal has reported earnings for its fourth quarter continuing an incredible run of success that spans its entire history as a stand-alone company. Since breaking up with online marketplace eBay, the cashless transactions provider has either beaten or met analysts’ estimates in every single quarter (and, of the fifteen, it’s beaten the Street in twelve)! That continued last week, as PayPal announced its best ever quarter for account growth.

PayPal’s share price has risen by 6.6% so far this year

graph 04 paypal

Source: Yahoo Finance

PayPal reported adjusted earnings of 69c per share for its fourth quarter, beating analysts’ expectations of 67c per share, and smashing its own performance a year ago (55c per share). The company also brought in impressive revenue, which grew from $3.69 billion a year ago to $4.23 billion in the last quarter. So, if its financials were so positive, why did the share price trade down as a result? The company’s guidance on revenue for the first quarter of 2019 was less-than investors and analysts had hoped.

PayPal has projected first-quarter earnings in a range of 66c – 68c for the first quarter of this year, and revenue between $4.08 and $4.13 billion. That’s a shade below analysts’ predictions, which is for earnings of 68c on revenues of $4.16 billion. Despite this, PayPal chose to reiterate its full-year guidance for 2019, which it released last time it reported earnings.

Summing up a positive quarter, PayPal’s CEO, Dan Schulman, told analysts on a call: “I’m pleased to report that PayPal had another strong quarter ending 2018 with a record-breaking growth across a number of key customer and financial metrics. Our transformation into an open digital-payments platform is clearly resonating with our customers. PayPal continues to benefit from increasing tailwinds as cash continues to digitize and more and more aspects of our lives move to mobile.”

Disclosure

Dominion holds PayPal in its Global Trends Managed Fund.


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