A while back I remember adding PYPL and SQ to my watchers list because they had undergone a correction and it appeared that they'd be solid investments, especially PayPal. About a year later and both of these stocks have done nothing but tank and I'm not understanding why.
SQ seems to have a pretty high valuation even right now given it's earnings, and I don't think it's justified because they're not necessarily innovating towards projects that will produce reasonable returns, and the projects they are working on (like Metaverse and NFT projects) are very high-risk. Although as a company it seems to otherwise have a solid business model and is in a relatively stable financial position.
PYPL is the one I'm really struggling to wrap my head around. 26 P/E, which could arguably be considered high for the financial sector, but its balance sheet suggests it's one of the most financially healthy companies in that sector. Not to mention, PayPal is consistently profitable (something many) fintech companies can't achieve) and continues to come up with new and innovative technology to lead the digital payments world.
Does anyone think either of these two stocks are due for a reversal any time soon? If not, what continues to drag them lower?
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