Here’s How Much a $1,000 Investment in PayPal Stock 9 Years Ago Would Be Worth Today
PayPal (PYPL) is a household name when it comes to peer-to-peer and alternative payment methods. You’d think that if you bought the stock in July of 2015, when it first traded independently as PYPL, per PYMNTS, you’d have a small fortune now. But believe it or not, with a closing May 2 share price of $66.98, you would not even have doubled your money.
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That is not to say that you would not have had plenty of opportunity along the way to reap some impressive gains if you had jumped ship at the right time. The fact is that PayPal has had a rollercoaster ride on the Nasdaq over the past decade.
For instance, PayPal’s highest stock price came in July of 2021 at 308.53, as macrotrends detailed. With a closing initial stock price of about $40, if you had timed everything perfectly and cashed out at the high, your investment would have grown to $7,713 — and would have made you a profit of $6,713. Not bad. But if you had held onto your shares till today, your investment would have dwindled to $1,702.16, giving you a profit of a much less attractive $702.
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Why Has PayPal Lost Value in Recent Years?
There are a few reasons for PayPal’s recent stock price decline. For one, PayPal is actually losing users. Since 2022, its user base has fallen off by 10 million, according to The Motley Fool (via Nasdaq). With 425 million current active users, that’s not a lot, but it isn’t the direction investors like to see. The decline is likely at least partially due to the increased competition in the payment app space.
Another potential reason for the share price decline is slagging revenue growth, which has been stuck between 5% and 10% for the past few years. That’s way down from 2021’s sometimes 20%-plus revenue growth, as The Motley Fool outlined. Another trend that doesn’t exactly enthuse investors.
Should You Buy PayPal Now?
This is a tough call. With a market cap higher than many of its competitors at nearly $70 billion and a P/E ratio lower than many competitors at 16.85 (as of May 3), no one could blame you for placing a bet on a PayPal turnaround. But it’s simply a different world today than in PayPal’s heyday, with more competition than ever before. So a PayPal share buy should be seen as a relatively solid investment in a value stock, but not a way to crush the market.
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This article originally appeared on GOBankingRates.com: Here’s How Much a $1,000 Investment in PayPal Stock 9 Years Ago Would Be Worth Today
