PayPal Stock Closes On Key Rating Benchmark As Its Namesake Payment Processing, Venmo App Lift Revenue, Profits

On Friday, the Relative Strength (RS) Rating for PayPal (PYPL) climbed to 71, up from 68 the day before. The good-but-not-great 71 RS Rating means PayPal stock has outperformed 71% of all stocks over the past year. But that rating doesn’t reflect the company’s underlying strength.




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History shows that the top-performing stocks tend to have an 80 or higher RS Rating as they launch their largest price moves. See if PayPal can continue to rebound and hit that benchmark.

PayPal Stock In Top 9% Overall

PayPal is growing on growing use of its flagship payment processing as well as its Venmo peer-to-peer cash transfer app.

Among other key ratings, PayPal stock has a 91 Composite Rating, putting it in the top 9% of all stocks on technical and fundamental metrics.

IBD’s Composite Rating combines five separate proprietary ratings of fundamental and technical performance into one easy-to-use rating. The best growth stocks have a Composite Rating of 90 or better.

Its 90 EPS Rating, on a 1-99 scale with 99 tops, reflects strong recent and long-term profit growth, as financial firms generally outperform lately. One yellow flag is its D+ Accumulation/Distribution Rating, on an A+ to E scale. The D+ rating means currently more institutional investors are selling than buying its shares.

Earnings Quiet After Surging Earlier

The San Jose, Calif.-based company posted a mild 7% EPS growth in the latest quarterly report, to $1.15. But that comes on the heels of quarters in which it reported 41%, 30% and then 85% EPS year-over-year growth. Revenue grew 19% in its most recent quarter, to $6.24 billion.

PayPal stock earns the No. 4 rank among its peers in the Finance-Card/Payment Processing industry group. Square (SQ) and Evertec (EVTC) are also among the group’s highest-rated stocks.


See How IBD Helps You Make More Money In Stocks


PayPal stock is building a flat base with a 310.26 entry. See if it can clear the breakout price in heavy volume. Keep in mind that it’s a later-stage consolidation, and those entail more risk.

When looking for the best stocks to buy and watch, one factor to watch closely is relative price strength.

IBD’s proprietary rating identifies share price performance with a 1 (worst) to 99 (best) score. The score shows how a stock’s price performance over the trailing 52 weeks compares to all the other stocks in our database.

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