PayPal Stock Up Monday Despite CEO Shake-Up, Takeover Interest, Lowered Outlook

PayPal Holdings Inc (NASDAQ:PYPL) entered a turbulent stretch, drawing takeover interest as its stock tumbled, management reshuffled leadership and analysts turned more cautious.

Despite all of that, PayPal shares jumped more than 5% today.

• What’s behind PYPL gains today?

Takeover Interest Emerges After Stock Slide

Potential buyers have approached PayPal after its shares lost more than 40% over the past year, wiping out nearly half of the company's value, according to people familiar with the matter.

The San Jose-based payments company has met with banks following unsolicited interest.

At least one large competitor is evaluating a bid for the entire company, while other suitors are exploring specific assets, Bloomberg reported on Monday.

Sources cautioned that talks remain preliminary and may not lead to a transaction.

The renewed interest comes after PayPal shares plunged more than 20% following an abrupt CEO change, weaker fourth-quarter results, and a softer outlook.

The sell-off erased nearly $10 billion in market value and pushed the stock near historic lows.

Leadership Shake-Up, Weak Outlook

CEO Alex Chriss stepped down despite taking the role in late 2023. The board appointed HP Inc. CEO Enrique Lores as PayPal's next CEO, effective March 1, 2026, and named CFO Jamie Miller as interim CEO.

On the earnings call, Miller said the board made the change because execution had been too slow, signaling dissatisfaction with the company's turnaround efforts.

PayPal reported that Branded Checkout growth slowed to 1%, down from 5% to 6% in prior quarters, highlighting pressure in its core business.

The company lowered its fiscal 2026 earnings outlook to a range spanning a single-digit decline to slightly positive growth and withdrew its 2027 guidance.

Miller said PayPal must prove improved performance in the coming quarters and years before restoring longer-term targets.

Miller added that Lores will bring stronger operational discipline and focus when he takes over.

Analysts Turn More Cautious

Wall Street analysts responded with downgrades and lowered price forecasts earlier in the month.

Canaccord Genuity's Joseph Vafi downgraded the stock from Buy to Hold and slashed his price target from $100 to $42.

He said larger commerce platforms are consolidating around vendors that exclude PayPal, while Apple Inc's (NASDAQ:AAPL) Apple Pay and Alphabet Inc's (NASDAQ:GOOGL)(NASDAQ:GOOG) Google Pay continue to bypass it.

Vafi called buy now, pay later a bright spot but noted Venmo, despite double-digit growth, contributes only about 5%-6% of total revenue.

JPMorgan's Tien-tsin Huang maintained a Neutral rating and cut the price target from $70 to $46.

The analyst attributed the earnings miss to weaker branded payment volume growth and highlighted the softer fiscal 2026 outlook and CEO transition.

Citizens JMP Securities' Andrew Boone downgraded the stock from Market Outperform to Market Perform.

He said the slowdown in branded checkout growth signals potential market-share losses and expects transaction-margin dollars to decline in 2026.

Boone added that PayPal may need to increase spending on loyalty programs and merchant incentives, and noted the incoming CEO is known for cost-cutting and restructuring initiatives.

PYPL Price Action: Shares of PayPal Holdings were up by 5.71% to $44.03 at the time of publication on Monday.

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