Stock Market Today, Feb. 24: PayPal Jumps on Takeover Interest and Unusually High Trading Volume

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NASDAQ: PYPL

PayPal

Today’s Change

(6.65%) $2.93

Current Price

$46.98

Key Data Points

Market Cap

$41B

Day’s Range

$43.03 - $47.94

52wk Range

$38.46 - $79.50

Volume

2.7M

Avg Vol

21M

Gross Margin

41.78%

Dividend Yield

0.32%

PayPal (PYPL +6.65%), a global digital payments technology platform, closed Tuesday at $47.02, up 6.74%. The stock rose after fresh reports detailed unsolicited takeover interest and potential suitors, and investors are watching whether formal offers or asset-sale plans emerge next.
Trading volume reached 57.8 million shares, about 187% above its three-month average of 20.1 million shares. PayPal IPO’d in 2015 and has grown 24% since going public.

How the markets moved today

The broader markets advanced Tuesday, with the S&P 500 (^GSPC +0.77%) rising 0.77% to 6,890 and the Nasdaq Composite (^IXIC +1.04%) gaining 1.04% to finish at 22,864. Within credit services, sector rival Adyen (ADYEY 1.08%) closed at $11, down 1.08%, as investors weighed differing growth paths and product strategies across payment platforms.

What this means for investors

PayPal’s stock movement on Tuesday can likely be attributed to reports that payments processor Stripe could be interested in acquiring all or part of PayPal’s business. Stripe is a private company, but a recent employee tender offer valued it at $159 billion. Assuming that’s true, an acquisition of PayPal, which has a market cap of approximately $44 billion, would be a substantial addition.

These rumors follow a turbulent couple of weeks where CEO Alex Chriss was ousted by the Board and replaced by Board Chair Enrique Lores. Chriss had been steering the company through an increasingly competitive fintech market. Investors should keep an eye out for potential changes in direction and see whether the new leadership can deliver improved results.