Enrique Lores, a director at PayPal Holdings (PYPL), recently picked up 1,100 shares. The buy increased his stake by over 26 percent, and came to a total cost of just under $97,000.
This follows up on a number of insider buys since late 2021. Company insiders have been exclusively sellers in the two years before that timeframe. The more recent insider buys have included directors and company executives as shares have substantially dropped from their highs.
Overall, insiders own 0.2 percent of shares.
The stock has shed two-thirds of its value in the past year, as tech names have deflated. PayPal has seen revenues grow by about 8 percent, but earnings have dropped by nearly half.
The drop has sent the company’s valuation from nearly 68 times earnings to about 22 times forward earnings, about in line with the market right now.
Action to take: PayPal has a leading payment platform online, and the company has a strong balance sheet, ensuring that it will continue to thrive as other fintech names take a hit right now. Investors may like shares following this sizeable drop, although there may be some short-term downside in the months ahead.
For traders, the January 2023 $100 calls, last going for about $7.60, could offer sizeable upside in the second half of the year. However, it may be prudent to first wait for markets to show signs of heading higher, not lower. That could allow the option to get cheaper before buying.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.