Aashika Suresh
4 min read
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Retail users remain bullish, expecting the deal to still happen later.
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Some other users focused on the company’s fundamentals, noting credit card strength and potential gains from rising cryptocurrency prices.
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Even as retail investors are optimistic about PayPal’s turnaround, Wall Street analysts last week slashed price targets following the news of the discarded acquisition plans.
Shares of PayPal Holdings Inc. (PYPL) posted their worst weekly performance since early February, shedding nearly 13%, and are on track to close August in the red after reports suggested that Advent and payment processor Stripe have dropped their buyout plans for the fintech firm. Retail investors, however, are convinced the story isn’t over.
Despite the sharp plunge in share prices, retail users remain ‘bullish’ on the company.
Why Is Retail Still Bullish On PayPal?
Retail users speculate the deal could still happen at a later date. Reports had also indicated that Advent and Stripe could return later with a revised offer.
One user said, “$PYPL Why a Deal Could Still HappenThe “Walk Away” Negotiation Tactic: It is highly common for a buying consortium to publicly “abandon” talks after being rejected to punish the target’s stock price. By letting PayPal’s shares plummet nearly 13% overnight back down to the $53 range, Stripe and Advent have successfully deflated the market hype. If PayPal’s board panics under pressure from angry shareholders, the buyers could return in a few months with the exact same—or only a slightly modified—offer from a position of absolute strength.”
Some other users discussed other strengths of the company that could bolster its prices higher even without a deal.
One user said, “$PYPL I think crypto is about to take off again in the coming years and that bodes well for PayPal strategy – I think that is an under talked about part of additional shareholder value coming.”
Another user said, “$PYPL They just issued a credit card with 3% back, so new management isn’t just sitting down. I think they will grow the company without needing a buyout.”
Meanwhile, a user poll that sought to gauge what investors thought about another bid to acquire PayPal found that a majority of users voted for a different company bidding for the payments provider. However, 30% of users voted that there was a likelihood that Elon Musk’s SpaceX (SPCX) may attempt to take over PayPal.
