Is PayPal Holdings, Inc. overvalued or undervalued?

As of 29 April 2025, the valuation grade for PayPal Holdings, Inc. has moved from fair to very attractive, indicating a significant improvement in its perceived value. The company is currently deemed undervalued. Key ratios include a P/E ratio of 18, an EV to EBITDA of 11.88, and a PEG ratio of 0.91, suggesting that the stock is priced favorably relative to its growth potential.
In comparison to its peers, PayPal's P/E ratio of 16.85 is notably lower than Visa, Inc.'s 33.34, which is classified as fair, and significantly lower than Mastercard, Inc.'s P/E of 58.16, categorized as very expensive. Additionally, PayPal's return on equity (ROE) stands at 22.71%, which is competitive within the industry. Despite a challenging performance against the S&P 500 year-to-date, where it has declined by 15.63% compared to a 2.44% increase in the index, the underlying financial metrics suggest that PayPal is well-positioned for future growth.