Can You Make a Millionaire Using PayPal?

Investors are optimistic and enthusiastic with key indices in a raging bull market. A few corporations aren't joining the rally. Consider PayPal (NASDAQ: PYPL). It is completely unpopular with investors. Its stock is 78% below peak. PayPal has down 8% since 2023, while the S&P 500 and Nasdaq Composite have risen.

Increasing user engagement PayPal's declining user base may have hurt its shares. The platform had 426 million active accounts on Dec. 31. That number is unchanged from 24 months ago. When client growth slows, investors worry.

This also indicates fierce digital payments rivalry. A fast-growing industry with long-term promise will attract competitors. Being one of the first significant participants in this market has given PayPal a strong brand and size that helps it defend against competitors.

Total payment volume (TPV) rose 13% to $1.5 trillion in 2023, demonstrating the company's strength. That figure was 63% higher than the 2020 boom. PayPal's fee- and usage-based business model makes more TPV better for revenue.

While user base flatlines, transactions per active account are rising steadily, which is promising. The typical platform user transacted 58.7 times in the past year. Up from 40.9 in 2020. CEO Alex Chriss, who joined late last year, has shown a commitment to new engagement strategies. AI integration is a priority.

Business is still quite profitable. PayPal's stock chart over the previous three years suggests bankruptcy. That's false. PayPal ended last year with $11.3 billion in long-term debt. That included $17.3 billion in cash, cash equivalents, and investments. That indicates a financially responsible company. More encouraging is the income statement. PayPal consistently earns double-digit operating margins. It generates billions in free cash flow annually. Financial stability and longevity reduce risk for this company.

About to reach a million Now may be the best time to buy PayPal stock. Its 13 future price-to-earnings ratio is dirt low. This is much cheaper than the S&P 500 and Nasdaq 100. The pessimism surrounding PayPal and its future is evident.

Of course, two key factors determine if a stock can help you reach $1 million. If you're willing to commit more upfront and have a longer time horizon, your odds are better. It depends on your bullishness. If PayPal seems like a good long-term investment, buy the stock today.

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