PayPal Stock Craters 20% On Earnings Miss; CEO Shake-Up Spooks Investors

• The fintech company named HP CEO Enrique Lores as its new head, succeeding Alex Chriss.
• BofA Securities cut its price target to $48 from $68, saying “most of the damage is done,” but warning the stock won’t outperform until new leadership shows tangible progress.
• TD Cowen slashed its target to $48 from $65, calling 2026 another transition year due to weak checkout trends and higher investment needs.

PayPal Holdings Inc.'s stock plunged more than 20% on Tuesday to its lowest level in nearly a decade, marking the worst single-day decline in its history. The sharp selloff followed the release of quarterly results that fell short of Wall Street expectations, along with the announcement of a change in chief executive officer as the company seeks to engineer a turnaround at the once-dominant financial technology giant.

PayPal erased nearly $10 billion in market value following Tuesday's sharp selloff and now has a market capitalization of about $39 billion after reporting disappointing quarterly earnings.

The company announced that HP Inc. CEO Enrique Lores will take over as PayPal's new chief executive, succeeding Alex Chriss. In the interim, Chief Financial and Operating Officer Jamie Miller will serve as interim CEO until Lores formally assumes the role in March.

Bank of America said the steep decline has prompted investors to reassess whether PayPal's struggles stem from management issues or deeper structural problems. The brokerage noted that investors are "questioning whether it is a management or a PayPal problem" and added that the stock is unlikely to outperform until new leadership demonstrates clear and tangible progress.

PayPal's CEO Change Sparks Furor

CNBC's Mad Money host Jim Cramer said that PayPal's numbers were disappointing. "Understand Alex Chriss was disappointing. Now Enrique Lores is CEO, and Bruce Broussard, late of HUM, is now ceo of HP. This one is very hard to process.. Big miss," Cramer said in a post on X.

A bullish user on Stocktwits said that hiring Lores sends "the worst possible signal," and that by hiring a cost-cutting CEO, the board is signalling the company is a declining business. "Here's a CEO who specializes in managed decline."

However, some other users noted that Lores is "EXACTLY who is needed here."

Wall Street Views Of PayPal Changes

BofA Securities analyst Mihir Bhatia slashed its price target on PYPL to $48 from $68 and maintained a 'Neutral' rating, according to The Fly. The firm believes "most of the damage is done" following Tuesday's plunge.

TD Cowen cut its price target on PayPal to $48 from $65 and noted that shares will remain adrift near term, adding that sentiment was broadly negative into the print. However, the research firm said there were significant surprises in both fourth-quarter exit rates and the fiscal 2026 outlook, as sluggish Branded online checkout and investment requirements are turning 2026 into another transition year.

Wall Street has a consensus 'Buy' rating on PayPal, according to Koyfin, with 27 out of the 45 analysts covering the stock rating it 'Hold' while 13 have a 'Buy' or higher rating and five rating it 'Sell.' The average price target was $69.52, implying a 40% upside from Tuesday's closing price of $41.70.

What Is Retail Thinking About PYPL?

Retail sentiment on PayPal improved to 'extremely bullish' from 'extremely bearish' a month ago, with message volumes at 'extremely high' levels, according to data from Stocktwits.

In the last 24 hours alone, retail message volume on Stocktwits soared 732%.

A user on Stocktwits said that PayPal stock is dead and will not rebound to all-time highs.

Shares of PayPal have declined 47% in the last 12 months.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

Also See: Chipotle Shares Drop 8% After Hours On Falling Traffic And Flat Sales Guidance

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