After positive quarterly results in May, at the end of July PayPal presented mixed results in which, unlike the previous quarter, revenue did not exceed market expectations – being reported at $6.24 billion compared to the $6.27 billion anticipated.
Despite this, during August, PayPal’s share price rose 4.77%, which contributed to a total increase of 23.23% during the first 8 months of the year.
Today, the company is once again in the news after announcing the acquisition of one of the most highly valued Japanese start-ups for a reported total of 2,720 million USD.
With the acquisition of Paidy, PayPal gains greater presence in the Japanese market, which is very valuable given that Japan is the third largest e-commerce market in the world. Therefore, it is expected that this acquisition will boost the company’s business volume, thus increasing profits and revenues.
For the time being, it appears that Paidy will retain its infrastructure and brand, with the final integration expected to take place at some point in the future.
Like most listed technology companies, over the last year PayPal’s share price has experienced a strong upward trend that led it to record highs of around 309 USD per share on 23 July, where it formed a double top with its previous highs represented by the green band in the chart below.
Currently, the price is in the process of closing the bearish gap formed on 29 July, which could give it a new impulse towards 300 USD per share in its quest to reach its current resistance levels.
The acquisition of this new company could be the trigger for a new bullish momentum that could be reinforced by the bullish crossover of its short and medium-term moving averages and the change from negative to positive territory in the MACD indicator.
Conversely, a failure to close the current gap and break above 300 USD per share could lead the price back to its current support levels at its moving averages. Moreover, the loss of its medium-term red trend line would open the door to a further correction.
Evolution of the last five years:
- 2020: 116.51%
- 2019: 28.64%
- 2018: 14.22%
- 2017: 86.52%
- 2016: 9.03%
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