Will PayPal start to pay out dividends?

Our board is committed to evaluating all options for return of capital to our shareholders.

Dan Schulman - CEO PayPal in the recent Earnings Call

Pressure from investors

The pressure of the new big shareholder Elliot Management but certainly by others too is definitely high on PayPal to improve their performance and the capital allocation. Investors are hopeful that the cooperation will be fruitful and so stock price is slowly stabilizing after a massive sellout of -80% over the past 12 months.

PayPal has just started a big share buyback, maybe that could mean they will also start paying dividends? Because doing a bit more than you already announced isn’t really worth a separate investor day, is it?

We expect to share a financial and strategic update, including capital allocation, at an investor day in early 2023.

Dan Schulman - CEO PayPal in the recent Earnings Call

Just a bit of maths: They generated a free cashflow of over 5 billion dollar last year and had outstanding stocks of about 1.1 billion. That makes 5 dollar free cashflow per share. Even if they are now doing a 15 billion share buyback that still leaves room to start paying dividends since cash flow is steady and the buybacks will probably not be paid out of cash flow but with credits.

What do you think? How likely is a PayPal Dividend?

Posted Using LeoFinance ^Beta

Posted Using LeoFinance ^Beta