Since there was brief interest on this board in PayPal, I thought I would share its quarterly results here. It just reported what I would call another strong quarter and is currently up about 5% in AH trading:
Online payments firm PayPal reported third quarter earnings on Thursday that matched analysts’ expectations for profit and revenue growth.
In its earning’s release, the company played up its emphasis on customer choice following a quarter in which it signed deals with Mastercard and Visa that allow its users to choose PayPal as an option when they pay for goods in stores with their smartphones.
“We are further expanding the ubiquity and value of the PayPal brand and moving deliberately towards achieving our vision of becoming an everyday, essential financial service for people around the world,” said CEO Dan Schulman in a press release.
Read the entire article at http://www.forbes.com/sites/ryanmac/2016/10/20/paypal-report…
Here’s a look at their updated revenues and earnings:
Revenues (millions) Q1 Q2 Q3 Q4
2014 1874 1983 1971 2193
2015 2137 2297 2258 2556
2016 2544 2650 2667
EPS (non-GAAP) Q1 Q2 Q3 Q4
2014 0.27 0.28 0.24 0.28
2015 0.29 0.32 0.31 0.36
2016 0.37 0.36 0.35
2016 Q3 Earnings
Revenue Growth (billions)
2015 Q3 TTM Revenue = 8.885
2016 Q3 TTM Revenue = 10.417
YOY Revenue Growth = 17.2%, previous Q 16.4%
EPS Growth
2015 Q3 TTM EPS = 1.2
2016 Q3 TTM EPS = 1.44
YOY EPS Growth = 20%, previous Q 23.9%
P/E (Check Current Price) = 40.09/1.44 = 27.84
1YPEG = 27.84/20 = 1.39
PayPal Metrics
Here is a look at some of PayPal’s other important metrics growth:
of active accounts: 192 million, +11% YOY
Payment transactions: 1.512 billion, +24% YOY
Payment transactions per active account: 30.2, +13% YOY
Total Payment Volume: 87.403 billion, +25%
Transaction margin: 58.7%
And here’s a look at the historic growth of those numbers:
# of Active Accounts (millions) Q1 Q2 Q3 Q4
2014 148 152 157 162
2015 165 169 173 179
2016 184 188 192
Payment Transactions (millions) Q1 Q2 Q3 Q4
2014 918 930 972 1144
2015 1123 1161 1216 1428
2016 1414 1448 1512
Payment Transactions Per Active Account Q1 Q2 Q3 Q4
2014 23 23 24 24.5
2015 25.2 26.1 26.9 27.5
2016 28.4 29.4 30.2
Total Payment Volume (billions) Q1 Q2 Q3 Q4
2014 53.676 56.736 58.184 66.039
2015 63.021 67.482 69.738 81.523
2016 81.056 86.208 87.403
Transaction Margin (percentage) Q1 Q2 Q3 Q4
2014 65.0 65.7 63.1 63.5
2015 64.2 63.8 62.3 61.1
2016 60.4 59.8 58.7
Yes, their transaction margin was down another smidgen of a percent but this was expected. As long as they keep growing users, transactions, revenues, and earnings at double digit clips, I don’t see how anyone can complain too much. Seems like a good trade-off to me. I will be sure to look over the conference call this weekend and report back.
Matt
Long PYPL
MasterCard (MA), Nestle (NSRGY), PayPal (PYPL), and Verizon (VZ) Ticker Guide
See all my holdings at http://my.fool.com/profile/CMFCochrane/info.aspx