Financial - Credit Services · NASDAQ
Current Price
$50.94
Intrinsic Value
Use the calculator below to estimate
Run a full DCF analysis on PayPal Holdings, Inc. with auto-filled fundamentals, adjustable assumptions, and sensitivity heatmap.
PayPal Holdings, Inc. operates a technology platform that enables digital payments on behalf of merchants and consumers worldwide. It provides payment solutions under the PayPal, PayPal Credit, Braintree, Venmo, Xoom, Zettle, Hyperwallet, Honey, and Paidy names. The company's payments platform allows consumers to send and receive payments in approximately 200 markets and in approximately 100 currencies, withdraw funds to their bank accounts in 56 currencies, and hold balances in their PayPal accounts in 25 currencies. PayPal Holdings, Inc. was founded in 1998 and is headquartered in San Jose, California.
ROIC (TTM)
15.0%
ROE (TTM)
25.9%
FCF Yield
12.14%
Based on trailing twelve-month data, PYPL shows a free cash flow per share of N/A and a ROIC of 15.0%, key inputs for stock valuation using the DCF method. The P/FCF ratio of N/A and FCF yield of 12.14% are important context metrics when evaluating PYPL's stock valuation relative to peers.
The intrinsic value of PYPL depends on assumptions about future growth rate, discount rate (WACC), and terminal value. A DCF model discounts projected free cash flows back to present value — small changes in WACC can shift the estimate by 20% or more, which is why sensitivity analysis is essential.
Whether PYPL is undervalued depends on comparing the DCF-derived intrinsic value to the current market price of $50.94. A positive margin of safety (intrinsic value above market price) suggests potential undervaluation, but the degree of confidence depends on the reliability of your growth and discount rate assumptions.
To perform a DCF valuation on PayPal Holdings, Inc.: (1) Start with the trailing free cash flow per share as the base, (2) project future FCF growth over 5-10 years based on Financial - Credit Services industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting PYPL's risk profile, and (4) add a terminal value for cash flows beyond the projection period.
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For PayPal Holdings, Inc., this means projecting how much free cash flow the Financial - Credit Services will produce over the next 5-10 years, then discounting those amounts to today's dollars. PYPL's ROIC of 15.0% shows moderate capital returns.
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For PYPL, the capital structure and equity risk premium determine WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%.
