PayPal upgraded to Outperform at Daiwa, Visa, Mastercard cut to Neutral

Aug. 16, 2022 8:19 AM ETPayPal Holdings, Inc. (PYPL), MA, VAXP, SQBy: Liz Kiesche, SA News Editor7 Comments

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Daiwa analyst Kazuya Nishimura upgraded PayPal Holdings (NASDAQ:PYPL) to Outperform due to the company's cost-cutting plan, stock buyback, appointment of a new chief financial officer, and its decision to hold an Investor Day event.

Meanwhile, the analyst cut card networks Visa (NYSE:V) and Mastercard (NYSE:MA) to Neutral, citing reduced earnings upside ahead as international travel restrictions have mostly been lifted. American Express (AXP) faces similar dynamics, but Nishimura says the stock is trading at "compelling valuation levels." AXP retains its Outperform rating.

The analyst also reiterates an Outperform rating on Block (SQ), supported by long-term growth prospects and short-term earnings driven by cost controls.

In Tuesday premarket trading, PayPal (PYPL) rose 1.1%, Visa (V) slipped 0.5%, and Mastercard (MA) is unchanged.

Nishimura's Outperform rating is more bullish than the Quant rating of Hold and aligns with the average Wall Street rating of Buy. Note that SA's Quant system also has Hold ratings on V, MA, SQ, and AXP, while the average Street ratings on all of the stocks are Buy. Compare other key metrics for all five stocks on the Peer Comparison function.

See why SA contributor Daniel Jones thinks PayPal (PYPL) still has some room to run

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