PayPal vs Affirm Which Offers More Value?

PayPal and Affirm are both prominent players in the financial technology industry, offering online payment solutions and tools for consumers and merchants alike. While PayPal has been a staple in the market for years, Affirm is a relatively newer player that has quickly gained traction with its flexible and transparent financing options. Both companies have seen significant growth in their stocks, but investors may need to consider factors such as market competition and growth potential when deciding between PayPal and Affirm stocks.

PayPal or Affirm?

When comparing PayPal and Affirm, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between PayPal and Affirm.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. PayPal has a dividend yield of -%, while Affirm has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. PayPal reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. On the other hand, Affirm reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with PayPal P/E ratio at 20.35 and Affirm's P/E ratio at -47.30. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. PayPal P/B ratio is 4.47 while Affirm's P/B ratio is 7.44.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, PayPal has seen a 5-year revenue growth of 1.07%, while Affirm's is 4.24%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with PayPal's ROE at 21.46% and Affirm's ROE at -16.49%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $88.38 for PayPal and $65.83 for Affirm. Over the past year, PayPal's prices ranged from $55.77 to $93.66, with a yearly change of 67.94%. Affirm's prices fluctuated between $22.25 and $72.82, with a yearly change of 227.28%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.