Paypal (NASDAQ:PYPL) is expected to report strong fourth-quarter 2021 earnings results after the market closes on February 1, based on monthly users statistics.
For a digital payments firms like PayPal, total website visits are a strong indicator of user involvement on PayPal’s platform. The more people visit PayPal’s website, the more money the corporation may generate through transaction fees, interchange fees, cash interest, and other sources.
Therefore, we turned to TipRanks‘ new tool, which records monthly and quarterly website visits, to learn more about PayPal’s performance ahead of Q4. The data for Paypal’s core platform revealed a clear upward trend, signaling a strong quarter ahead.
The graph below shows that the total estimated visits to paypal.com grew during the quarter to be reported. More specifically, we observed that total visits to paypal.com increased by 10.35% sequentially to 1.8 billion.
In addition, the tool shows that PayPal’s other subsidiaries, such as Honey, Venmo, Xoom, and Braintree, have also seen an increase in user visits on a sequential basis in Q4. More precisely, total projected visits to joinhoney.com, venmo.com, xoom.com, and braintreepayments.com increased by 24.5%, 2.7%, 3.4%, and 26.2%, respectively, on a sequential basis.
This total quarterly rise suggests robust transactional activity on Paypal’s platform. Also, PayPal’s key metrics, such as total payment volume (TPV), active customer accounts, and a total number of payment transactions, may have improved in the fourth quarter, favorably boosting the company’s revenue in the fourth quarter.
On a less positive note, we noticed that the total estimated visits to paypal.com are down 1.93% year-over-year in the fourth quarter, dampening the Q4 euphoria to some extent. However, this year-over-year drop should not be a reason for concern, as no company-specific issues have been detected.
To conclude, the overall monthly user figures point to a high likelihood of significant revenue growth for PayPal in Q4. The customers’ shifting preferences toward contactless payments in the aftermath of the coronavirus pandemic could be attributed as a big factor in the growing website visits to PayPal.
Experts’ Take
Ahead of the PayPal earnings release, BTIG analyst Mark Palmer maintained a Buy rating on PayPal but decreased the price target to $270 from $345 per share.
PayPal also has a Strong Buy rating from Wall Street analysts, with 27 Buys, 6 Holds, and only 1 Sell. The PayPal stock projections indicate an average price target of $252.25, suggesting a possible 12-month upside of 60.7%.
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