PayPal Holding, Inc. (PYPL)

As the technology advancing further, we are getting closer to become a cashless society. Digital wallet and mobile payment are going to be essentials in the global market.  Paypal is one of the most used digital payment services in the world. It has active users of 237M and growing. In 2017, China’s Baidu has entered a partnership agreement with PayPal to allows its users to purchase overseas merchants. It helps Paypal to set its foot into one of the largest emerging market which is dominated by Alipay and Wechat. The adoption rate is a lot higher in emerging market such as : China and India, comparing to developed countries. We are seeing a huge growth potential in this field. PYPL is currently trading at $74/share. It has a forward P/E at 26.86 which is a healthy range. (Data was provided by Thomson Reuters.) ROE is at 11.69%.  In 2017, net income vs free cash flow is a healthy: 1.8B/1.86B. Moreover, it reported the latest earnings last week. Revenue grew to $3.69B up 24% year over year.It beat company’s top line forecast. EPS also beat the consensus: 0.45 vs 0.41. Venmo, the company’s social platform, continues to gain popularity among millennial. Although it is only operating in the states, we strongly believe that it will be open to other regions later on. We are still seeing huge potentials with the company. Our price target is at $90 by the end of 2019.

P.S. We have a long position

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