Price to Operating Profit (P/OP)
since 2015
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- Income Statement
- Balance Sheet: Assets
- Balance Sheet: Liabilities and Stockholders’ Equity
- Cash Flow Statement
- Common-Size Income Statement
- Analysis of Profitability Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Selected Financial Data since 2015
- Total Asset Turnover since 2015
- Price to Book Value (P/BV) since 2015
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Calculation
PayPal Holdings Inc., P/OP, long-term trends, calculation
| P/OP | = | Share price1, 2, 3 | ÷ | Operating profit per share1 | Operating profit per share1 | = | Operating income1 (in millions) |
÷ | No. shares of common stock outstanding2 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Feb 10, 2023 | = | ÷ | = | ÷ | |||||||
| Feb 3, 2022 | = | ÷ | = | ÷ | |||||||
| Feb 5, 2021 | = | ÷ | = | ÷ | |||||||
| Feb 6, 2020 | = | ÷ | = | ÷ | |||||||
| Feb 7, 2019 | = | ÷ | = | ÷ | |||||||
| Feb 7, 2018 | = | ÷ | = | ÷ | |||||||
| Feb 8, 2017 | = | ÷ | = | ÷ | |||||||
| Feb 11, 2016 | = | ÷ | = | ÷ |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
1 US$
2 Data adjusted for splits and stock dividends.
3 Closing price as at the filing date of PayPal Holdings Inc. Annual Report.
- Share Price
- The share price exhibited a general upward trend from 2016 through early 2021, increasing from $33.52 to a peak of $269.44. However, post-2021, the share price experienced a notable decline, falling to $124.30 in 2022 and further decreasing to $80.80 in 2023. This suggests an overall increase in market valuation until 2021, followed by a correction or downward adjustment in the subsequent two years.
- Operating Profit Per Share (OPPS)
- The operating profit per share showed consistent growth throughout the entire period, rising from $1.19 in 2016 to $3.39 in 2023. The increase was steady with only a slight dip in the final year, indicating improving operational profitability on a per-share basis over the eight years considered.
- Price to Operating Profit Ratio (P/OP)
- The P/OP ratio generally trended upwards from 28.05 in 2016 to a significant peak of 95.94 in 2021, reflecting a substantial expansion in investor valuation relative to operating profit. After this peak, the ratio decreased sharply to 33.98 in 2022 and further to 23.82 in 2023, indicating a revaluation of the stock price against operating profit, potentially signaling market adjustment or decreasing growth expectations.
- Overall Analysis
- While operating profit per share steadily increased, shareholder valuation as indicated by share price and P/OP ratio showed high volatility, peaking in 2021 before experiencing marked declines. The decoupling of share price valuation from operational profitability post-2021 suggests changing market sentiment or external factors influencing investor perception. The declining P/OP ratio post-2021 may imply improved valuation attractiveness relative to operating profits or a market correction after an extended period of high multiples.
Comparison to Competitors
PayPal Holdings Inc., P/OP, long-term trends, comparison to competitors
| PayPal Holdings Inc. | Accenture PLC | Adobe Inc. | Cadence Design Systems Inc. | CrowdStrike Holdings Inc. | Fair Isaac Corp. | Intuit Inc. | Microsoft Corp. | Oracle Corp. | Palantir Technologies Inc. | Palo Alto Networks Inc. | Salesforce Inc. | ServiceNow Inc. | Synopsys Inc. | Workday Inc. | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Feb 10, 2023 | |||||||||||||||
| Feb 3, 2022 | |||||||||||||||
| Feb 5, 2021 | |||||||||||||||
| Feb 6, 2020 | |||||||||||||||
| Feb 7, 2019 | |||||||||||||||
| Feb 7, 2018 | |||||||||||||||
| Feb 8, 2017 | |||||||||||||||
| Feb 11, 2016 |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).