Hedge Funds Were Right About MicroStrategy Incorporated (MSTR) and 4 Other Tech Stocks

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

Number of Hedge Fund Holders in Q1 2022: 100    

Number of Hedge Fund Holders in Q4 2021: 110   

PayPal Holdings, Inc. (NASDAQ:PYPL) is a digital payments firm. On June 7, the company announced that it was opening up the PayPal network to let users transfer cryptocurrencies from the network to other wallets and exchanges. Some of the coins compatible for this include bitcoin, Ethereum, bitcoin cash, and litecoin. The company plans to roll out the feature to all eligible customers in the US in the coming weeks. 

On May 2, Mizuho analyst Dan Dolev maintained a Buy rating on PayPal Holdings, Inc. (NASDAQ:PYPL) stock and lowered the price target to $120 from $175, noting that “disappointing execution” was one of the reasons behind the target decrease. 

At the end of the first quarter of 2022, 100 hedge funds in the database of Insider Monkey held stakes worth $6.2 billion in PayPal Holdings, Inc. (NASDAQ:PYPL), compared to 110 in the preceding quarter worth $19.9 billion.

In its Q1 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and PayPal Holdings, Inc. (NASDAQ:PYPL) was one of them. Here is what the fund said:

“PayPal Holdings, Inc. (NASDAQ:PYPL) enables digital payments for consumers and merchants worldwide. Shares fell on disappointing 2022 guidance that called for 15% to 17% revenue growth but flat EPS growth due to higher credit costs and a higher tax rate. Management also tempered user growth expectations due to a strategic shift toward improving engagement of existing users and away from less-productive new user acquisition. Despite reduced earnings expectations, we believe the share price decline is overdone given PayPal’s growth opportunities and competitive advantages. We reduced PayPal Holdings, Inc. (NASDAQ:PYPL).as it became clear that strong growth trends during the early part of the pandemic were not persisting in a more normal environment.”