$PYPL is down 31% in 2026. The CEO got fired. Earnings missed by $300 million. And a U.S. senator bought shares five days before the whole thing blew up.
This is PayPal right now. A fintech giant in full crisis mode, trading at $40 and near 52-week lows while the board scrambles to convince anyone the turnaround is still alive.
The Earnings Disaster
PayPal reported Q4 2025 on February 3 and missed on everything that matters. Revenue came in at $8.68 billion — $304 million below consensus. Adjusted EPS hit $1.23, falling $0.08 short. The stock cratered nearly 20% in a single session.
| Metric | Q4 2025 | vs. Estimate |
|---|---|---|
| Revenue | $8.68B | Missed by $304M |
| Adjusted EPS | $1.23 | Missed by $0.08 |
| Stock reaction | -20% | Single day |
| YTD decline | -31% | Near 52-week low |
The guidance was worse. Management projected mid-single-digit EPS declines for 2026 as the company ramps investment spending. Flat to down earnings, after a quarter that already missed. Not exactly a confidence builder.
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Branded checkout — the crown jewel — is underperforming. Management admitted execution "has not been where it needs to be." Former PayPal president David Marcus piled on publicly, calling out the company's defensive BNPL strategy that handed market share to Klarna and Affirm.
The CEO Firing
Same day as earnings, the board announced Alex Chriss was out. Not resigning to "pursue other opportunities." Out. The board cited dissatisfaction with "the pace of change and execution."
His replacement: Enrique Lores, the HP Inc. CEO who delivered six consecutive quarters of revenue growth at the printer company. He starts March 1.
The optics are brutal. Chriss took over in September 2023 promising a PayPal renaissance. Fifteen months later, the board pulled the plug mid-earnings. That's not a planned transition. That's a firing dressed up in a press release.
CFO Jamie Miller runs the show until Lores arrives. The company is effectively headless during its worst crisis in a decade.
The Senator's Suspiciously Timed Trade
Here's where it gets interesting. Senator John Boozman disclosed purchasing PayPal shares worth between $1,001 and $15,000 on January 29 — five days before the earnings disaster. The filing dropped February 15.
Boozman sits on the Appropriations Subcommittee on Financial Services and General Government, which oversees regulators affecting payment processors. He's down roughly 25% on the trade since.
Was it insider knowledge? Probably not — the buy amount is tiny and he's underwater on it. More likely it was a routine portfolio addition that happened to hit terrible timing. But the optics of a financial services committee member buying a fintech stock days before it implodes will draw scrutiny regardless.
Boozman's broader disclosure showed a flurry of trades across Visa, Netflix, Exxon, Apple, and multiple ETFs. The man was busy in January.
The Bull Case (If You Squint)
At $40, PayPal trades at roughly 7.5x earnings with over $6 billion in expected free cash flow for 2026. That's cheap for a company still processing over $400 billion in payment volume quarterly.
Analysts maintain a consensus target of $51.88, implying 27% upside. Daiwa slashed its target from $61 to $42 — a 31% cut — but even that implies the stock is near fair value, not overvalued.
Lores is a known operator. HP isn't exciting, but he stabilized it and grew revenue consistently. If he can bring that discipline to PayPal's scattered product strategy, there's a path back.
The Venmo monetization story is still early. The automotive payments integration with UpdatePromise opens new verticals. And at this valuation, a lot of bad news is already priced in.
The Bear Case (And It's Loud)
Competition is eating PayPal alive. Apple Pay owns mobile. Shop Pay owns e-commerce checkout. Klarna and Affirm own BNPL. Stripe owns developer payments. Every moat PayPal built in the 2010s has been breached.
The branded checkout decline is existential, not cyclical. When merchants start removing your button from checkout pages, that's not a temporary headwind. That's customers choosing alternatives.
Mid-single-digit EPS declines in 2026 means the company is spending more just to slow its slide. There's no growth catalyst on the horizon that justifies patience — just a new CEO from a hardware company trying to fix a payments and software problem.
The $6 billion buyback program masks the deterioration. Revenue per share looks better than it is because the share count keeps shrinking. Strip out buybacks and the organic story is grim.
Bottom Line
PayPal at $40 is either a deep value trap or a generational entry point, and right now the evidence tilts toward the former. The earnings miss was bad. The CEO firing was worse. The 2026 guidance killed whatever momentum remained.
Lores gets the benefit of low expectations when he starts March 1. If he can stabilize branded checkout and articulate a credible strategy within two quarters, the 7.5x multiple re-rates fast. If the next earnings report looks anything like Q4, this stock has a $30 handle ahead of it.
The senator's trade is a footnote. The real question is whether anyone at PayPal has a plan. Right now, the answer is: we'll find out in March.
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