PYPL - PayPal Holdings Inc.

Cheap but for a reason - dislikes the business and user experience, prefers other opportunities

PayPal's moat has eroded due to competition from Apple Pay, etc., with gross margins falling to 46%.

The presenter's analysis shows intrinsic value in the range of $70-$200 per share, with a mid-point around $106-$124. At $54 (post-buyout pop still below offer price), the stock offers a significant margin of safety and a 21.5% annualized return potential over 10 years under conservative assumptions. The presenter agrees with Michael Burry that the $60.50 offer is too low and the company is a 'screaming deal' at current levels.

Losing market share, declining EPS through 2026, opportunity cost outweighs potential.

Burry sees PayPal as a bombed-out quality stock with strong cash flow, aggressive buybacks, and a monetizing Venmo. He believes the selloff was due to AI rotation fear, not business problems.

Generates $5.5B FCF, selling at 7.5x FCF. Michael Burry adding. Conservative revenue growth (2-6%) yields 22.5% return. Strong buyback potential.

Host agrees with Burry's thesis. Down 24%, selling at only 7x free cash flow vs NASDAQ 100 at 45x. Strong revenue growth over 7 years, 21.5% share buybacks, high returns on capital. DCF middle target of $94-104 vs current $42 represents significant upside. Host personally owns shares.

Used as a prime example of a 'buyback trap.' PayPal has been doing buybacks for four years while growth continuously decelerates. The CEO was hired with great promises but has failed to deliver. Competition in fintech is too intense, and the buyback strategy is not working.

Cited as a company famous for doing buybacks, taking advantage of volatility by repurchasing shares when the stock price declines.

PayPal is mentioned as being down 29% YTD. The host notes it has over 400 million active users and is still growing revenue and profit. It's listed among the names being watched but not analyzed in depth.