With the market off to a hot start in 2024 and hitting new highs, investors might assume that they missed the boat and that there aren’t many bargains out there. But there are still compelling investment opportunities.
Take a look at PayPal (NASDAQ: PYPL). This fintech giant’s shares are about 80% off their peak price. Don’t let that price history discourage you, though.
Here are three reasons that PayPal is a no-brainer growth stock to buy now with $100 and hold for the long term.
Leader in digital payments
One of the most obvious reasons that investors will want to scoop up shares of PayPal is because of just how much it dominates the electronic payments industry. PayPal was founded more than two decades ago, so it has a long and successful history of facilitating global commerce.
This is a scaled business, with a presence in more than 200 countries and regions. Total payment volume (TPV) was $1.5 trillion in 2023. That was up 13% over 2022 and more than double the amount in pre-pandemic 2019.
Data from the end of 2022 shows that PayPal was the most widely accepted digital wallet, with a near 80% acceptance rate, at the top 1,500 retailers in North America and Europe. And its Braintree segment, which caters to merchants, has grown TPV at a much faster clip than the rest of the business.
PayPal is clearly a dominant force. As online shopping and other forms of cashless transactions become more popular, the business should benefit from a long-term growth driver.
Competitive advantages
PayPal possesses numerous competitive advantages. This is another important reason buying this stock makes sense right now.
As of Dec. 31, the business had 428 million active accounts using its services, creating a two-sided platform of merchants and consumers. This results in powerful network effects, which is an extremely attractive characteristic for a business to have.
Because PayPal has so many users already on its platform, it is able to make exponentially more connections between buyers and sellers. This means that PayPal is more valuable to all of its users than smaller payments…
..
