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Stripe and Advent bid $60.50 per share for PayPal in $53B deal
The proposal is backed by $50 billion in committed bank financing and would value PayPal at $60.50 per share, after shares jumped about 17% to close near $55.50 on July 15.
Stripe and Advent International have launched a joint $53 billion acquisition proposal for PayPal Holdings, valuing the payments company at $60.50 per share, according to MarketBeat Ratings. The offer is structured as a 50/50 joint venture supported by $50 billion in committed bank financing.
Shares rose sharply after the July 15 announcement, climbing about 17% and closing near $55.50, moving above PayPal's prior 50-day trading range of $40.70 to $47.65. The article also notes the proposed deal price implies a 28% premium over PayPal's pre-announcement closing level.
MarketBeat Ratings argues that investors should compare the bid to PayPal's fundamentals, highlighting $33.17 billion in annual revenue and $5.23 billion in net income, with a 15% net margin. The piece points to a return on equity of 25.02% and a debt-to-equity ratio of 0.47, saying the balance sheet remains strong.
The source further says PayPal generates $7.54 per share in free cash flow, and that at a $60.50 price the offer equates to just under eight times free cash flow, versus a trailing price-to-earnings ratio of 10.40. It adds that investor Michael Burry, of Scion Asset Management, publicly rejected the $60.50 bid as an opening offer.