PayPal
PayPal Holdings Inc. (NASDAQ: PYPL) has seen its share price drop by more than 13% over the past 12 months, including a 6% increase so far in 2023. The company has fired some 2,000 people in an effort to get expenses under control but continues to face competitive challenges from large entrants like Apple and Google into the space PayPal has carved out for itself in more than 20 years. Sales rose year over year in the first quarter, as did profits. PayPal stock may get a boost if it can keep up that kind of performance.
Of 49 analysts covering the stock, 33 rate it at Buy or Strong Buy, and 16 have Hold ratings. At a share price of around $75.00, the upside potential based on a median price target of $90.00 is 16.7%. At the high target of $200.00, the upside potential is nearly 140%.
Second-quarter revenue is expected to come in at $7.27 billion, up 3.3% sequentially and by 6.8% year over year. Adjusted EPS are forecast at $1.16, down 0.6% sequentially but 24.7% higher year over year. For the full 2023 fiscal year, estimates call for EPS of $4.94, up 19.6%, on sales of $29.59 billion, up 7.5%.
PayPal stock trades at 15.2 times expected 2023 EPS, 13.2 times estimated 2024 earnings of $5.67 and 11.9 times estimated 2025 earnings of $6.32 per share. The 52-week range is $58.95 to $103.03. PayPal does not pay a dividend, and the total shareholder return for the past 12 months was negative 13.12%.
Qualcomm
Networking chip and equipment maker Qualcomm Inc. (NASDAQ: QCOM) has dropped about 9.7% from its share price over the past 12 months. The Dow Jones industrial average component could be a real value at its current share price, or it could be a value trap.
The company has been working on a way to shrink AI language models to fit on a cell phone. Qualcomm beamed at the recent announcement of Meta Platforms’ decision to release its Llama 2 large language model as open source. If, as the company believes, Qualcomm is way ahead of all its competitors in figuring out how to run AI algorithms on a smartphone, the stock is a bargain. If not, well, not so much.
Of 33 analysts covering Qualcomm, 25 have a Buy or Strong Buy rating and another seven rate it at Hold. At a share price of around $131.00, the upside potential based on a median price target of $140.00 is 6.9%. At the high target of $159.00, the upside potential is 21.4%.
Third-quarter fiscal 2023 revenue is forecast to come in at $8.51 billion, down 8.2% sequentially and 22.1% lower year over year. Adjusted EPS are forecast at $1.81, down 15.4% sequentially and by 38.9% year over year. For the full fiscal year ending in September, analysts expect the company to post EPS of $8.25, down 34.1%, on sales of $36.05 billion, down 18.4%.
Qualcomm stock trades at 15.9 times expected 2023 EPS, 13.7 times estimated 2024 earnings of $9.60 and 13.0 times estimated 2025 earnings of $10.12 per share. The 52-week range is $101.47 to $152.91. Qualcomm pays an annual dividend of $3.20 (yield of 2.42%). Total shareholder return over the past 12 months was negative 7.02%.
Originally published at 24/7 Wall St.
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