Buffett Brain · Research note
Score updated 22 Oct 2026 · analysis from 23 Aug 2026
PYPL· Financial Services
PayPal
PayPal's digital payments platform delivers a 14.41% owner earnings yield, but moat strength remains uncertain.
Buffett fit
Partial fit
Owner
46
Durability
64
Management
67
Price
100
Score updated 22 Oct 2026 · analysis from 23 Aug 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Financial Services stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
Owning 100% of PayPal, we would focus on maintaining its market position and expanding its user base.
The full reasoning comes with a free account.
PayPal's network effects provide some durability, but the payments industry is competitive, with potential disruption from technological advances or regulatory changes.
The full reasoning comes with a free account.
PayPal's management has effectively reduced the share count by 4.93% annually, enhancing per-share value.
The full reasoning comes with a free account.
With a of 7.9 and an yield of 14.41%, PayPal is priced attractively.
The full reasoning comes with a free account.
Free account
Read the full PayPal analysis free
- The full reasoning behind all four pillars
- The 5-year price target and the return it implies
- What would change the call
- Graham, Lynch and Greenblatt on the same stock
3 full analyses a week · no card needed
For and against
The strongest points on each side, with the numbers behind them.
In its favor
7- 1 yield of 14.41% offers a compelling valuation.
- 2Share count CAGR of -4.93% demonstrates effective .
- 3Interest coverage of 17.8 indicates strong financial health.
- 4Net debt/EBITDA of 0.34 shows a conservative position.
Concerns
5- 1 of 46.12% is below sector top-quintile of 81.5%.
- 2 of 17.85% is below sector top-quintile of 58.8%.
- 3 YoY growth of -17.78% suggests potential cash flow issues.
- 4EPS max decline of -40.85% in 5 years indicates volatility.
Price history
$57.20-76.2%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
PayPal operates a digital payments platform facilitating transactions for merchants and consumers across 200 markets. Its revenue stems from transaction fees and value-added services. With a TTM revenue of $33.17B and net income of $5.23B, the business benefits from a 15% net margin. Unit economics are strong with a 46.12% .
How this analysis has moved
The call has held across 5 reviews.
Sep 27, 2026 → Oct 22, 2026
What other investors would say
The same company, judged by three other documented playbooks.
Keep researching
Similar companies in Financial Services
Free weekly email
Liked the read on PYPL? Get the next ones on Monday.
Every Monday: the stocks most of the seven investors newly agree on. One email, unsubscribe any time.
Research, not investment advice.
See the Buffett analysis of PayPal
The score, the checklist and the full reasoning open with a free account. You get 3 full analyses a week, and this stock is the first one. No card needed.
Create a free account3 full analyses a week · no card needed
Already have an account? Sign in