PayPal has set the market on fire after being valued higher than some of the biggest tech companies like Twitter Inc (NYSE:TWTR), Netflix, Inc. (NASDAQ:NFLX) and parent company eBay. Paypal Holdings Inc (NASDAQ:PYPL), the leading global payment solution provider started trading independently on Monday after splitting up from eBay Inc (NASDAQ:EBAY) last week.
According to Statista, PayPal had a total market cap of $49.5 billion, which was higher than that of all these big names.
Insights on the matter
The eye-popping valuation of PayPal is a clear indicator that the market has responded positively to PayPal’s split up from eBay, which had bought it for $1.5 billion in 2002. There are rumors that the company had to take such a crucial decision under the pressure mounted by the activist investor, Carl Icahn.
PayPal is the leading digital payment solution provider with over 169 million users globally. The company has already acquired Venmo, a peer-to-peer payment app and Braintree, the leading in-app payment technology provider to improve its services. The company had recently bought Xoom, a leading global money transfer service provider to elevate its service umbrella.
eBay After Splitting From PayPal
Nothing has gone fine with eBay after the spin-off of PayPal. The stock value of eBay has been declining after the split and sale of its enterprise business for $925 million. In 4Q2014, PayPal contributed 82% to eBay’s annualized revenue growth; hence, in one way, eBay has just lost its largest revenue contributor.
All the market experts call it one of the worst decisions taken by the e-commerce giant ever. The management of the company hasn’t come forward and spoken on this issue; however, experts claim that the upcoming quarterly results will reveal the actual picture in a better way.