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Wolfe Research keeps Peerperform rating on PayPal stock amid Apple Pay concerns

EditorEmilio Ghigini
Published 2024/06/13, 12:46
© Reuters.

On Thursday, Wolfe Research maintained a Peerperform rating for PayPal Holdings Inc (NASDAQ:PYPL) stock, despite a 6% drop in the company's shares earlier in the week.

This decline contrasted with a 2% rise in the S&P 500 Index during the same period. The research firm connected the decrease in PayPal's stock value to recent announcements at Apple's Worldwide Developers Conference regarding Apple Pay and the Apple Wallet.

The firm's analysis suggested that although PayPal continues to hold a larger user base than its competitors Apple and Google in the digital payment space, it may fall behind in terms of customer engagement, especially in in-store transactions where Apple and Google Pay are more commonly used. The firm acknowledged that the latest developments from Apple might pose a risk to PayPal's transaction volumes.

Despite the potential challenges posed by Apple's announcements, Wolfe Research believes that the shift of users from PayPal to Apple or Google's payment services has largely occurred already.

The firm pointed out that off-platform usage of Apple Pay could introduce additional steps for users, as transactions must be completed on an Apple device, which could deter some customers.

The commentary from Wolfe Research comes after PayPal's stock experienced volatility, with the company navigating a competitive landscape where tech giants are consistently enhancing their payment platforms. PayPal, known for its online payment system, faces ongoing pressure to maintain its lead in the industry as rivals introduce new features to attract users.

In summary, Wolfe Research's stance on PayPal indicates a watchful approach, recognizing both the strengths and potential vulnerabilities of the company in the face of evolving market dynamics in the digital payment sector. The firm's current assessment reflects a cautious optimism about PayPal's ability to sustain its market position despite competitive threats.

In other recent news, Apple Inc (NASDAQ:AAPL). has partnered with OpenAI and is utilizing Google's AI technology to enhance its voice assistant, Siri. This collaboration and the use of Google's AI technology underscores Apple's commitment to advancing its AI capabilities.

Meanwhile, Alphabet (NASDAQ:GOOGL) Inc., Google's parent company, has recently seen its share target raised by Evercore ISI due to a strong outlook for its search capabilities. This adjustment follows a survey that reinforced confidence in Alphabet's competitive position within the search engine market.

BofA Securities has also maintained a positive stance on Alphabet stock, citing the company's promising AI prospects. This comes in the wake of Apple's announcement of new AI features for the iPhone, including a partnership with OpenAI. Alphabet's Google has recently settled monetary damages claimed by the United States, thus avoiding a jury trial regarding its alleged dominance in digital advertising.

In terms of trading, New Jersey's 5th congressional district representative, Josh Gottheimer, has made a series of notable trades involving high-profile companies, including Alphabet. These recent transactions provide additional insights into the company's financial landscape. These developments are part of the recent news surrounding these tech giants.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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