![]() ![]() Trading at $235 at the end of 2020, it ought to be able to make it to $300 by next Christmas. ![]() If Venmo achieves half of what Schulman says is on its dance card in 2021, while I don’t think it will pull off a second consecutive year doubling its share price, I could easily see it deliver a 29% increase as it did in 2019. More importantly, Schulman expects Venmo to be profitable in 2022. Add in the Venmo credit card and improvements for Pay with Venmo, and it’s understandable why the CEO is happy with its progress. Schulman believes that the transformation Venmo will undergo this year to improve the app’s functionality will drive increased engagement with customers. “As Venmo’s revenue base diversifies and scales, its transaction margin continues to improve and we now expect Venmo to also make a positive contribution to our transaction margin dollars in 2021.” Venmo’s growth continues to exceed our expectations and we are forecasting revenue for Venmo to approach $900 million in 2021, driven by investments in new capabilities,” Schulman told analysts on Nov. “Venmo had a very strong Q3 with 65 million users, driving $44.3 billion in TPV, up 61% year over year. Venmo Monetization ProgressĪs chief executive officer Dan Schulman stated in its third-quarter 2020 conference call in November, Venmo’s pulled its weight in the quarter. I’d expect to hear more on this front in 2021. While many in China doubt PayPal’s ability to compete with existing players in the online payment market, the fact that the Chinese government is cracking down on anti-competitive companies such as Alibaba (NYSE: BABA), combined with its ownership of GoPay should enable it to make further inroads in the Chinese market. “In taking full control of one of the smaller players in the world’s largest payment market, PayPal will compete with domestic payments giants Alipay, owned by Alibaba-affiliated Ant Group, and WeChat Pay, owned by Tencent Holdings Ltd, as China fully opens up its financial sector,” Reuters reported. ![]() PayPal acquired 70% of Guofubao Information Technology (official name) in September 2019. 14, news surfaced that PayPal had acquired the remaining 30% of China payments platform GoPay it didn’t already own. More New Revenue Generation Possibilities I’ll continue to look for signs more is happening. Since then, I haven’t seen much chatter about the relationship. “With this integration, about 346mn PayPal customers will be able to buy products from around 500,000 sellers on MercadoLibre,” BNAmericas reported in August 2020. In July 2020, the two companies integrated their payment methods in Brazil and Mexico. In May 2020, MercadoLibre allowed users of its MercadoPago payment service to use Paypal for transactions in other parts of the world. Assuming it kept them all, it would have a return on investment of 355% over less than two years based on a current price of $1,985.Īs for the partnership itself, the ties between the two companies have gotten closer. It appears as though PayPal has sold some of its MELI shares since March 2019. 30, 2020, it had marketable equity securities worth $1.62 billion, up considerably from its $750 million investment. In a private placement, PayPal purchased 1.72 million shares of MELI stock on March 15, 2019, for $436.10 a share. One of my favorite Latin American companies, PayPal, bought $750 million in MELI stock in March 2019 when it first struck up its partnership arrangement. PayPal’s Latin American PartnershipĪs I stated in my 2020 piece, PayPal expanded its partnership with MercadoLibre (NASDAQ: MELI) at the end of 2019. Leaning on my three key points from 2020, I’ll consider whether PayPal has enough gas in the tank to double for a second consecutive year. In hindsight - PYPL delivered 2020 returns of 115% - it seems silly to have questioned whether it could repeat its 29% return from 2019 because it obliterated that return.Ĭalled on by the powers that be to write about PayPal in 2021, I hope it’s not my only opportunity this year to discuss one of the more successful spinoffs of the 21st century. At the time, PayPal stock was trading around $110. ![]()
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