TacticScaleWhat PayPal Does & How It Makes Money (PYPL)
Updated October 2026 · reflects PayPal's latest reported financials
Digital payments platform connecting merchants and consumers worldwide. PayPal earns fees on payments processed through its network for merchants and consumers, and makes additional revenue from its consumer credit products and other value-added payment services.
How PayPal makes money
PayPal earns fees on payments processed through its network for merchants and consumers, and makes additional revenue from its consumer credit products and other value-added payment services.
What PayPal does
PayPal Holdings operates a two-sided payments network at scale that connects merchants and consumers. Customers can connect, transact, send and receive payments, and transfer or withdraw funds online and in person, using bank accounts, PayPal or Venmo balances, credit and debit cards, consumer credit products, cryptocurrencies, and stored-value products like gift cards and rewards. Its brand portfolio covers several parts of payments: PayPal and Venmo for consumer wallets and peer-to-peer transfers, Braintree for merchant payment processing, Xoom for international money transfers, Hyperwallet for payouts, PayPal Credit and Paidy for consumer credit, and Honey for shopping rewards. Founded in 1998, the company is headquartered in San Jose, California.
Products & services
- PayPal
- Venmo
- Braintree
- PayPal Credit
- Xoom
- Honey
What is PayPal worth?
On an owner-earnings DCF, PayPal's most-likely value is about $162 versus a recent price near $56 (193% below fair value). But TacticScale only calls a stock undervalued when the price sits below its conservative no-growth floor (~$87) with a margin of safety — so the honest verdict here is “Deeply discounted.” Fair value earns its keep only at the extremes, not in the wide middle.
On the financials alone, $56 is below even the no-growth floor ($87); the market's discount — expectations and sentiment beyond the numbers — is pricing in ≈ -5.2%/yr. A bargain only if that pessimism is overdone.
Analysis, not advice. Fair value is a margin-of-safety estimate from a deterministic owner-earnings DCF, not a price target or recommendation. See the full breakdown →
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