Morgan Stanley Reduces Price Target on PayPal Holdings (PYPL)

Core Viewpoint - PayPal Holdings, Inc. (NASDAQ:PYPL) is facing challenges with a recent downgrade from Morgan Stanley, which has reduced its price target and profit projections, indicating a difficult outlook for the company's growth and market position [2][3]. Financial Performance - PayPal reported adjusted EPS of $1.20 for the third quarter, surpassing forecasts of $1.07, but the revenue of $7.85 billion fell short of the projected $7.89 billion [4]. - The company anticipates low single-digit revenue growth in the fourth quarter, significantly below analyst expectations of 5.4% growth to $8.46 billion [4]. Analyst Insights - Morgan Stanley has downgraded PayPal from Equal Weight to Underweight, citing challenges in upgrading branded checkout integrations and predicting slow dollar growth through 2028 due to factors like lack of Venmo revenue generation and declining take rates [2][3]. - The firm views the ongoing issues as an overhang on the stock, suggesting that the company's market position may continue to weaken [3].