PayPal's battered stock is getting a record boost from a report of buyout interest

By Steve Goldstein and Hannah Pedone

Rival Stripe and private-equity firm Advent have reportedly teamed up to bid for PayPal, but some investors say the bid should be higher

PayPal has reportedly become the target of Stripe and Advent International.

Shares of PayPal, the struggling payments processor, were having their best day ever on Wednesday, after the release of a report that rival Stripe is teaming up with private-equity group Advent International on a bid.

Reuters, citing two people described as familiar with the situation, said the companies are offering $60.50 per PayPal share (PYPL), valuing the target at over $53 billion.

The report said the bid was submitted earlier this month and PayPal is yet to give a response.

PayPal, Stripe and Advent each declined to comment.

The stock shot up 15.9% in recent morning trading, enough to lead the S&P 500 index's SPX gainers. That puts the stock on track to break the current record for a one-day gain of 14.1%, set on March 24, 2020.

PayPal shares had peaked at $308.53 on July 23, 2021. Since then, even with Wednesday's rally, the stock has plunged 82%, while the S&P 500 has soared 72%.

After such a selloff, Michael Burry, the former hedge-fund manager chronicled in the "Big Short" who now authors a popular Substack, said the reported price of $60.50 per share is not high enough for what he calls one of the cheapest quality businesses in his portfolio.

He said PayPal's true intrinsic value is between $75 and $115 a share, and a winning bid should be roughly $100. "With control over the cash flows, those businesses and the personnel, the new owner will have many levers to increase value and make for a better overall business," said Burry.

But analysts don't think the problems the company has faced can be easily fixed. In March, PayPal named a new CEO, and in April the company said it was splitting its operations into three divisions to try to drive growth.

"We continue to think that the challenges facing PayPal across its Branded, Venmo, and Braintree/PSP businesses will be very difficult to overcome, and will require more than just sharpened focus, but likely also significantly accelerated investment, which we have yet to see management signal willingness to do," Morgan Stanley analysts led by James Faucette said in a note in May.

Of the 47 analysts surveyed by FactSet who cover PayPal's stock, just nine are bullish, while 32 are neutral and six are bearish. The average stock-price target of $47.14 implies 14% downside from current levels.

Meanwhile, analysts at Jefferies said a deal could help Stripe's consumer-facing business, Link, and bring scale to its small- and midsize-business offerings.

-Steve Goldstein -Hannah Pedone

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07-15-26 1036ET