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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 $809.5B against $49.0B — 16.5× the size. PayPal Holdings, Inc. trades at the lower P/E: 11.2× against 32.7×. Visa Inc. grew revenue faster over the last twelve months: 14.8% against 4.36%. Visa Inc. has the higher net margin (51.2% vs 13.8%) and the higher return on invested capital (40.4% vs 16.1%). Both pay a dividend; PayPal Holdings, Inc. yields more (0.95% vs 0.63%). Across the 21 metrics below, Visa Inc. leads on 11 and PayPal Holdings, Inc. on 10.

Valuation

Metric PYPL V Credit Services median
P/E 11.16 32.72 8.96
P/S 1.46 16.55 1.00
P/B 2.57 21.33 1.23
Price to free cash flow 7.92 34.44 2.55
EV/EBITDA — — —
EV/Sales — — —
Earnings yield 8.96% 3.06% 7.17%
Free cash flow yield 12.62% 2.90% 11.75%

Profitability

Metric PYPL V Credit Services median
Gross margin 40.55% 100.00% 76.61%
Operating margin 16.99% 61.24% 0.34%
Net margin 13.78% 51.20% 8.35%
Free cash flow margin 18.43% 48.05% 8.73%
Return on equity 23.83% 64.60% 9.05%
Return on assets 5.86% 24.23% 1.94%
Return on invested capital 16.06% 40.41% 4.56%

Growth

Metric PYPL V Credit Services median
Revenue growth (TTM) 4.36% 14.76% 4.49%
EPS growth (last fiscal year) 35.59% 14.07% 21.94%
Revenue growth, 5-year CAGR 9.11% 13.75% 9.22%
Net income growth, 5-year CAGR 4.49% 13.81% 0.00%

Health

Metric PYPL V Credit Services median
Debt to equity 0.69 0.61 0.69
Current ratio 1.26 0.97 1.26
Net debt to EBITDA (0.06) 0.25 0.11

Dividend

Metric PYPL V Credit Services median
Dividend yield 0.95% 0.63% 1.64%
Payout ratio 0.11 0.22 0.21

Size

Metric PYPL V Credit Services median
Market cap 48.98b 809.54b 759.73m

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