Paypal Holdings Inc (NASDAQ: PYPL) stock fell over 3.51% on 26th July, 2018 (as of 10:24 AM GMT-4; Source: Google finance) on lower than expected revenue guidance. The group expects a revenue in the range of $3.62 billion and $3.67 billion for the third quarter as compared to the revenue of $3.71 billion as per Thomson reuters
On the other hand, the group has increased the presence in the U.K. and India through partnerships with Santander, Clydesdale, and HDFC Bank. Each of those financial institutions will now enable their customers to easily link their bank issued cards to their PayPal Wallet and open a PayPal account from their online channels. The company formed the strategic partnership with South Korean credit card issuer ShinhanCard. The company also continued to have strategic partnership with Google. In the second quarter, PYPL announced that users in the US who add PayPal to any one of Google’s services will soon be able to pay across the Google ecosystem anywhere that PayPal is offered as a payment method.
PYPL in the second quarter of FY 18 has reported the adjusted earnings per share of 58 cents, while reported the adjusted revenue growth of 23 percent to $3.86 billion in the second quarter of FY 18. The company has delivered $820 million in non-GAAP operating income, rising 24% year-over-year, driven by the non-GAAP operating margin of 21.3%, which was up 25 basis points from last year. Further, PYPL has added 7.7 million net new actives during the second quarter with new user growth up 18% year-over-year. This brings the total active accounts to 244 million.
Engagement on our platform increased 9% to just under 36 times per year, up from 33, a year ago. For the first half of the year, our net new actives equaled almost 16 million and we anticipate adding over 30 million net new actives for the year.
PYPL has raised its full-year 2018 revenue growth guidance range from 17 to 18 percent to a range of 17 to 19 percent. PYPL has also slightly raised its full-year earnings per share guidance from between $2.31 and $2.34 to a new range of between $2.32 and $2.35.
In the third quarter, PYPL is expecting the revenue to be in the range of between $3.62 billion and $3.67 billion and earnings per share is expected to be in the range of between 53 cents and 55 cents.
Bank of America has a “buy” rating and the price target of $98 for PYPL stock.