PayPal's Agentic Commerce: How is it Preparing for This Revolution?

Core Insights - Perplexity and PayPal have launched an agentic shopping product for U.S. users, coinciding with the holiday shopping season, with a free app available for download next week [1][9] Group 1: Product Overview - The new app allows consumers to purchase items directly from over 5,000 merchants through Perplexity's search engine, utilizing past search insights for personalized results [2][9] - Agentic commerce represents a new trend in online shopping where AI agents assist consumers in discovering, comparing, and purchasing products, enhancing the shopping experience [3] Group 2: PayPal's Strategy - PayPal introduced its agentic commerce services last month, providing a suite of solutions for merchants to attract customers through AI-driven shopping [4] - The agentic commerce ecosystem includes partnerships with major AI and e-commerce companies such as OpenAI, Google Cloud, and Shopify, aimed at creating scalable and secure AI e-commerce experiences [5] Group 3: Competitive Landscape - Mastercard has launched the Mastercard Agent Pay program, enabling secure online shopping using AI agents, collaborating with Stripe and Google to establish infrastructure [6] - Shopify's Commerce Assistant Agent framework allows developers to integrate AI agents into workflows, enhancing customer interactions and checkout experiences [7] Group 4: Financial Performance - PayPal shares have declined by 29.3% year to date, underperforming the broader industry and the S&P 500 Index [8] - The stock is trading at a forward 12-month P/E of 10.37X, significantly lower than the industry average of 19.74X, indicating a potentially undervalued position [10] - Recent estimate revisions show a positive trend, with the Zacks Consensus Estimate for 2025 EPS suggesting a year-over-year growth of 14.8% [11]