PayPal Holdings, Inc. (PYPL) vs Visa Inc. (V)

PayPal Holdings, Inc. and Visa Inc. are both Credit Services companies. Visa Inc. is the larger, with a market value of $686.4B against $45.0B — 15.2× the size. PayPal Holdings, Inc. trades at the lower P/E: 10.3× against 30.1×. Visa Inc. grew revenue faster over the last twelve months: 14.4% against 5.69%. Visa Inc. has the higher net margin (50.8% vs 14.4%) and the higher return on invested capital (38.0% vs 16.9%). Across the 22 metrics below, PayPal Holdings, Inc. leads on 12 and Visa Inc. on 10.

Valuation

Metric PYPL V Credit Services median
P/E 10.33 30.09 9.64
P/S 1.41 14.71 0.87
P/B 2.44 18.88 1.16
Price to free cash flow 7.31 31.14 2.99
EV/EBITDA 7.34 23.41 9.58
EV/Sales 1.48 14.91 2.32
Earnings yield 9.68% 3.32% 6.72%
Free cash flow yield 13.68% 3.21% 12.33%

Profitability

Metric PYPL V Credit Services median
Gross margin 40.48% 100.00% 77.13%
Operating margin 17.42% 60.68% 0.34%
Net margin 14.36% 50.78% 9.25%
Free cash flow margin 19.35% 47.23% 13.03%
Return on equity 24.50% 62.36% 8.49%
Return on assets 6.03% 23.22% 2.29%
Return on invested capital 16.92% 38.04% 4.09%

Growth

Metric PYPL V Credit Services median
Revenue growth (TTM) 5.69% 14.39% 4.62%
EPS growth (last fiscal year) 35.59% 4.83% —
Revenue growth, 5-year CAGR 9.11% 12.86% 9.13%
Net income growth, 5-year CAGR 4.49% 13.04% 0.00%

Health

Metric PYPL V Credit Services median
Debt to equity 0.68 0.68 0.68
Current ratio 1.29 0.99 1.55
Net debt to EBITDA (0.06) 0.13 0.13

Dividend

Metric PYPL V Credit Services median
Dividend yield — 0.78% 3.34%
Payout ratio 0.00 0.22 0.00

Size

Metric PYPL V Credit Services median
Market cap 45.03b 686.42b 872.19m

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