MoneyShow Top Picks 2026: PayPal Holdings Inc. (PYPL)

One of our highest-conviction ideas heading into 2026 is PayPal Holdings Inc. (PYPL), the world’s largest two-sided payments network with more than 438 million active accounts. While the price action implies permanent impairment, the fundamentals tell a very different story, notes Tom Hayes, editor of HedgeFundTips.

Once the poster child of pandemic-era growth stocks, up 3x from 2020-2021, the stock has since been left for dead, now trading more than 80% below its $300-plus highs. That reset has turned a former growth darling into a deeply misunderstood value name, and we believe every piece is now in place for PayPal to return to its former glory.

(This write up came from our MoneyShow 2026 Top Picks Report. To get a FREE copy of the entire report, click here.)

Since 2021, revenue has grown more than 31%, earnings about 17%, free cash flow over 20%, and the share count has been cut by around 18%. This all circles back to a principle we live by: in the short term, the market is a voting machine driven by sentiment and headlines, but in the long term, it is a weighing machine that prices fundamentals.

The big disconnect has been the slowing-growth narrative, which we believe is misplaced. For years, prior management kept shareholders happy and continued to “beat the quarter” by leaning into empty-calorie, unprofitable volume within Braintree, the enterprise PSP behind every Uber trip or DoorDash order.

When Alex Chriss (the Intuit veteran who oversaw the SMB division responsible for more than 50% of revenue and helped turn the stock into a 38-bagger) stepped in as CEO in 2023, he made the tough but correct call to “fire” unprofitable customers. That intentional reset created a 5%-6% revenue drag for several quarters, fueling the slowing-growth narrative.

That headwind is now fully lapped, with the segment’s TPV inflecting to +6% last quarter and set to accelerate further with much better profitability. While the market fixated on the cleanup, Chriss focused on building PayPal’s next growth engines.

Venmo is tracking to around $1.7 billion in revenue in 2025 (growth >20%) with monetization still only 20%-25% of long-term potential. BNPL is scaling rapidly, with volume set to exceed $40 billion in 2025 at >20% growth, and those users transact around 5x more often than standard checkout customers.

PayPal is also an underappreciated AI beneficiary. It has emerged as the default wallet for agentic commerce as the first digital wallet integrated into ChatGPT and Perplexity...and it recently signed a multi-year partnership with Google.

At just 11x earnings, with mid-teens EPS growth and several new drivers in early innings, we see plenty of room for a re-rating opportunity. We expect the stock to work toward $150-plus over the medium term with a margin of safety most growth stories can only dream of.