How To Buy PayPal Stock

PayPal (NASDAQ: PYPL) has been the best pal to everyone that prefers the convenience of online money transfers — from remote workers to avid shoppers. But what if you can get that “friendship” to a whole new level and monetize it?

Here comes the question is PayPal a good investment? And if so, how to buy PayPal stock? We’ve got it all covered in this article. Just read on!

How to Buy PayPal Stock: A Beginner’s Guide

Based on several metrics and the median analyst estimate, the PayPal stock forecast is rather promising at the moment. But it’s important to consider a number of factors before deciding to venture into the stock market world. We’ll look into the following:

  • Company performance
  • The COVID-19 pandemic impact on the PayPal share price
  • Does PayPal pay a dividend?
  • What price target have analysts set for PYPL?
  • Is PYPL stock overvalued?
  • Risks to consider
  • Top brokers supporting PayPal investment
  • Is PayPal stock a good stock to buy?
  • How to buy PayPal stock? (step-by-step guide)

About the company

Technology entrepreneurs Peter Thiel and Max Levchin established PayPal in 1998. Under its initial name Confinity, the company developed security software for handheld devices. It later switched its focus to digital payments and rebranded.

Headquartered in San Jose, California, PayPal has quickly become the premier choice of online payment solutions. Currently, there are more than 325 million PayPal accounts in more than 200 markets worldwide. We witness the company expanding its services, venturing even into cryptocurrency territory.

PayPal has had an overall healthy financial record over the past two decades.

In February 2021, the company reported its strongest quarterly performance to date. PayPal revenue almost tripled in the three months ended December 2020, reaching $6.12 billion. Full-year revenue came in at $21.45 billion.

PayPal has been a public company since February 2001. The PayPal IPO pricing was $13 per share. In 2015, the stock started trading on the NASDAQ under the PYPL ticker symbol.

The COVID-19 pandemic impact on PayPal stock price

The entire 2020 was very challenging even for big market players, but PayPal managed to exceed the expectations. Nearly 10 million PayPal customers conducted in-store payments through the service during 2020. This accounted for over $20 billion in total payment volume.

With the massive adoption of digital payments, PayPal stocks skyrocketed, gaining almost 132% since the COVID-19 outbreak. The last closing PYPL stock price was $253.34 as of February 26, 2021.

Does PayPal pay a dividend?

PayPal is currently not paying any dividends. But you can find the hypothetical PayPal stock dividend ratio based on its next fiscal year earnings per share (EPS), multiplied with payment ratios.

Is PayPal a good stock to buy?

So, do Wall Street analysts advise investors to buy PayPal stocks?
Yes, the company’s current consensus rating is ‘buy’, with an average score of  2.90.

According to market watchers’ PYPL stock forecast, the shares will rise further in the next year. The average PayPal stock price target is $275.53, suggesting a possible increase of 8.5% from the current price.

Is PayPal stock overvalued?

Another factor to consider when deciding whether to buy PayPal stocks is the price-to-earnings (P/E) ratio. This measure helps investors determine the company’s market value as compared to its annual net income. A higher P/E ratio indicates strong demand for the shares fueled by an expectation of future earnings growth. As of February 2021, the P/E ratio for PayPal is 95.83.

The price/earnings to growth (PEG) ratio goes hand in hand with the P/E ratio. This is a valuation metric that indicates the company’s expected growth. It’s calculated when the P/E Ratio is divided by annual EPS growth. A lower ratio means a higher value. PayPal’s current PEG ratio is 2.41.

Although the P/E and PEG are in the typical range for the technology sector, both multiples indicate that PayPal stock is currently overvalued.

How to buy PayPal stock? (Step-by-Step Guide)

After analyzing PayPal stock history , the company’s competitive position and financial outlook, you may have decided to bet on the positive PYPL stock forecast and buy some shares in the e-commerce giant. If so, follow these steps:

Compare trading platforms/online brokers

You need to keep in mind that not all brokers will let you buy PayPal stock as they might not have access to the NASDAQ. Also, some brokers charge high fees. So, you need to look for a platform with low commissions, good ratings, and an easy-to-use interface. Check out our suggestions further below.

Open a brokerage account and transfer funds

When you choose a platform to use, it’s time to set up your account. The process is similar to opening a bank account. It includes providing your personal and banking information. Sometimes it takes a few days for your profile to get approval, though.

Once you have it all set, you need to deposit funds. It’s easy to transfer money, and you can do it via bank transfer or debit/credit card. Some online platforms even let you pay with your PayPal wallet.

Expanding your portfolio — Is PayPal a good investment for you?

Before reaching the point of no return and making a purchase, evaluate if PayPal stocks are indeed a good addition to your portfolio. Consider the following:

  • Are you prepared to commit to long-term investment and monitor the stock’s future price movements?
  • Do you have an objective grasp of your financial situation?
  • As mentioned above, PayPal doesn’t pay any dividends. Is that fine with you, or do you see it as a serious drawback?
  • How much can you afford to invest?

Being familiar with the PayPal stock price history is crucial, but knowing your own financial state, strengths, and weaknesses is even more critical. Stocks are extremely volatile. Yet, in the tech niche, where the price of a single share is pretty high, returns don’t come overnight. You should be aware that you may need to leave that money for months and even years before cashing out.

Also, it’s important to have a thorough plan and stick to it. You must weigh your decisions carefully. Imagine the disaster of selling your stock while on its lowest and then watching it jump back up. Try to choose the right time to buy and sell.

Good to go? Push the buy button

When you’re ready with your analysis and decision to invest, it’s time to place your order. Use the NASDAQ: PYPL ticker symbol to find PayPal shares. Then, insert the number of shares you want to purchase.

There are two main types of stock orders — limit and market. If you decide to go with the market type of order, you will purchase shares at the current price. On the other hand, if you choose a limit option, the purchase will be executed when the stock reaches the pre-selected target price. If you want to buy just a few PayPal shares, the market option may be more suitable for you.

Review your PayPal positions at all times

If you think that pressing the buy button is the end of your investment journey, you’re wrong. In fact, this is just the beginning. You need to monitor the PYPL share price and adjust your strategy according to current events and future projections.

If you plan to keep your PayPal stocks for a short amount of time and sell them with the next increase, you can use a dedicated tool. Once the shares reach your target price, you will get a notification.

Factors and risks to consider before you decide to buy

In the stock market world, the opportunities are numerous, but so are the risks. When investing in PYPL stocks, you need to be aware of the following:

  • Negative share price movements — there is always the risk that stocks you buy will lose their value.
  • Going all-in — a potential mistake is focusing on PayPal stocks exclusively. If the company suddenly loses ground, you will lose all your funds. Market specialists recommend portfolio diversification. Avoid investing everything in just one company.
  • Scam — there is always the danger of someone scamming you. The internet is full of fake brokers and false promises. When you see some unrealistically large or guaranteed returns, you should get suspicious.

Top PayPal brokers

To help you narrow down the search, we’ve listed some of the best brokers working with PayPal stocks:

eToro — Learn from the pros

Founded in 2007, eToro has become one of the most popular trading platforms where you can buy PYPL shares. It’s available in various markets and can help you build your portfolio. There is even an option to copy successful traders’ investment decisions.

eToro’s downsides include high forex trading, withdrawal, and inactivity fees.

Degiro  — Lowest fees

Degiro is a Dutch online broker established in 2008. Courtesy of top-notch regulation, the platform offers safe trading experience. Degiro is well-known for charging the lowest fees on the market. The interface is very intuitive and extremely easy to use.

Yet, there are some drawbacks. Degiro doesn’t support forex trading. Also, the broker doesn’t feature any education materials, so it’s more suitable for experienced investors.

TD Ameritrade — Good for beginners

You can also find the PayPal ticker on TD Ameritrade. The US-based trading platform is a good choice for novice traders since there are extensive educational resources. Expert advice is also available. TD Ameritrade has low trading fees and excellent customer support.

The downsides are that the platform is limited to the US only, and there are no credit/debit card deposit options.

Robinhood — No commissions fees

Robinhood is easy to use and doesn’t require large initial capital. Its main advantage is the zero commission fees and “free stock” bonus for new account holders. The app is highly intuitive and makes investment convenient. Be careful, though. With Robinhood’s ease of use and affordability, inexperienced users can get carried away and make risky investments.

Fidelity — Best for trading research

Fidelity is also among the most popular trading platforms where you can purchase PayPal shares. It has a proven track record and is regulated by well-known financial authorities. Fidelity is available globally and offers a wide variety of tools to help you explore your options in detail.

Naturally, there are certain cons. Fees are a bit high, while customer support is clunky. The app interface is not the best, either.

Bottom Line: Is PayPal a good investment?

The company’s strong performance and market position make PayPal stocks an investment worth considering. If you’re an aspiring investor, bear in mind the stock’s volatility. The price will drop eventually, and then you can catch the tide. While you are waiting for your moment to buy PayPal stocks, try to broaden your portfolio, get a better grip of how things are functioning and be ready for the next wave.

FAQ

Which major investors are buying PayPal stock?

PYPL shares exist in the portfolio of major inventors such as Massachusetts Financial Services Co, CIBC Private Wealth Group LLC, Findlay Park Partners LLP, and more.

What percentage of PayPal is owned by insiders or institutions?

Insiders currently own less than 1% of PayPal stocks or approximately $257 million worth of shares.

When is the fiscal year-end for PayPal?

PayPal’s fiscal-year end date is December 31.

Is PayPal a tech stock?

Yes. As a digital payment company, PayPal Holdings is a tech stock.

What is PayPal's ISIN number?

PayPal’s ISIN number is US70450Y1038. The International Securities Identification Number serves for securities identification for cross-border transactions.

What is PayPal’s Central Index Key?

PayPal’s CIK is 1633917. The Central Index Key numbers is a unique identifier for financial filings with the US Securities and Exchange Commission (SEC).

What is PayPal's CUSIP number?

PayPal CUSIP number is 70450Y103. CUSIP number represents a unique identification number assigned to publicly-traded companies.

What is the PayPal ticker symbol?

PayPal is trading under the NASDAQ: PYPL stock symbol. If you’ve already made an investment decision and now you just want to know how to buy PayPal stock, find a trading platform or online broker that supports the PYPL ticker. The more user-friendly trading services will guide you through all the further steps.

ABOUT AUTHOR

I’ve been trading stocks for a decade now and in the last several years, I’ve added cryptocurrency to my portfolio as well. Managing this stellar team of professionals in the financial industry is my way of giving bаck to the community. I aim to offer the best financial services on the market.

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