PayPal’s stock tumbles after Morgan Stanley’s brutal 31% price-target cut
PayPal’s stock has taken another hit after Morgan Stanley slashed its price target by nearly a third. The financial firm downgraded the company from Equalweight to Underweight, citing concerns over slow growth and rising competition in the stock market today. Shares dipped in early trading as investors reacted to the news.
Morgan Stanley cut PayPal’s target price from $74 to $51, marking a 31% reduction. Analysts pointed to weak progress in branded checkout integrations and ongoing struggles to monetise Venmo in the stock market today. The firm also warned of sluggish transaction margin growth through 2028, blaming market share losses and shrinking take rates in the stock market today.
This is the third downgrade PayPal has faced in December 2025 alone. Earlier in the month, Bank of America and J.P. Morgan also lowered their ratings. The company’s stock, already volatile with a beta of 1.49, fell 0.8% in premarket trading after the announcement in the stock market today.
Pressure on PayPal is growing as rivals expand their reach in the stock market today. Apple Pay and Google Pay continue to dominate digital wallets, while Europe’s bank-backed Wero platform—launched in 2024—is rapidly spreading across merchants and banks. These competitors are likely chipping away at PayPal’s market share in the stock market today.
Despite the challenges, PayPal remains financially stable. The company holds a current ratio of 1.34 and a debt-to-equity ratio of 0.56. Revenue for the past year reached $32.86 billion, with a three-year growth rate of 12.7%. Its market capitalisation stands at $56.16 billion.
The downgrade reflects broader concerns about PayPal’s ability to compete in a crowded payments market in the stock market today. With transaction margins expected to stagnate and rivals gaining ground, the company faces an uphill battle. Analysts will be watching closely to see if PayPal can reverse its current trajectory in the stock market today.
