Billionaire Cliff Asness’ 10 Stock Picks with Huge Upside Potential

5. PayPal Holdings, Inc. (NASDAQ:PYPL)

AQR Capital Management’s Q4 Stake: $258.1 million

Upside Potential as of April 26: 30.43%

Number of Hedge Fund Holders: 94

PayPal Holdings, Inc. (NASDAQ:PYPL), based in San Jose, California, operates a technology platform that enables digital payments for merchants and customers worldwide. The company provides payment services under several brands, including PayPal, Credit, Braintree, Venmo, Xoom, and Zettle.

The company currently has 432 million active accounts in more than 200 countries. In 2024, PayPal’s branded checkout segment had a constant quarterly increase in transaction margin dollars, with US growth notably speeding up in Q4.

On April 16, Wells Fargo analyst Andrew Bauch lowered the price target for PayPal Holdings, Inc. (NASDAQ:PYPL) from $80 to $74 while maintaining an Equal Weight rating. Bauch’s study identified a number of challenges for the company, including a quarter four branded Total Payment Volume (TPV) shortfall relative to market expectations, management guidance regarded as aggressive, and ongoing competitive issues.

Wedgewood Partners stated the following regarding PayPal Holdings, Inc. (NASDAQ:PYPL) in its Q1 2025 investor letter:

“PayPal Holdings, Inc. (NASDAQ:PYPL) was a leading detractor from performance for portfolios during the quarter. The Company’s branded checkout grew by a healthy +6% while total payment volumes grew by +7% during the Company’s most recent quarter. PayPal also outlined several reinvestment initiatives across its platform that continue to accelerate its branded checkout volume growth back to double digits. In addition, the Company has authorized nearly $20 billion in share repurchases which represents nearly a third of its market cap as of quarter end. We continue to hold PayPal as one of our largest active weights in portfolios.”