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That its own plan can create more value than Stripe and Advent were willing to pay in cash. The company gets its first chance to prove that on July 28.
On July 15, Reuters reported that Stripe and Advent International had offered $60.50 per share, roughly $53 billion, to take PayPal private. The offer carried a 28% premium to the prior close and about $50 billion in committed bank financing, with the two bidders splitting ownership equally and, per the reporting, no plans to break the company up.
PayPal’s board said no within days and formalized the rejection on July 20, with advisers at Goldman Sachs and Evercore and a reported ask closer to $70 a share.
A rejection at $53 billion is a claim that current management, executing the current plan, will deliver shareholders more than $53 billion of value on its own. That claim deserves to be tested against the record, because the record is the reason the company was available at $47.37 a share in the first place.
PayPal peaked at $305.88 on July 23, 2021, a market value near $360 billion. The bid landed on a company worth about $44 billion, down almost 90% from that peak while payments volumes across the industry kept growing.
Why The Bidders Were Willing To Pay Up
Stripe does not make careless offers. The company was valued at $159 billion in its February 2026 employee tender after processing $1.9 trillion in 2025, up 34% in a year. It paid $1.1 billion for Bridge, the stablecoin infrastructure firm, and incubated Tempo, a payments blockchain that raised $500 million at a $5 billion valuation from Thrive and Greenoaks. Advent, for its part, has invested more than $7.8 billion across 18 payments and fintech companies since 2008, including Worldpay, Nets and Nexi. The firm’s own sector report cites the Worldpay and Vantiv carveouts as proof that payments divisions become global champions outside their parents, which reads today like a thesis statement about PayPal.
What the pair wanted is legible from the coverage: PYUSD and its stablecoin distribution across 70 markets, branded checkout, Venmo, and what KBW analyst Sanjay Sakhrani called PayPal’s distinctive consumer data advantage in agentic commerce. The bid priced PayPal as the distribution asset of the next payments cycle. The board’s counter is that PayPal can capture that value itself, under its own management. On that question, the last five years get a vote.
Five Years Of Reversals
Start in October 2021, when reports surfaced that PayPal was exploring an acquisition of Pinterest at around $70 per share, a deal in the $39 billion range. PayPal’s own shares sank on the news, then jumped more than 6% premarket when the company walked away. When the market celebrates the death of your biggest strategic idea, that is data.
Then came February 2022. A year after setting a target of 750 million active accounts, management abandoned the goal, disclosed that 4.5 million accounts were illegitimate, and cut revenue guidance. The stock fell 25% in a day to a 52-week low. The super-app vision quietly followed the account target out the door.
Elliott Management arrived in August 2022 with a $2 billion stake and talk of a value-creation plan. Within a year the fund had dissolved the position entirely. Activists do not walk away from working plans.
Alex Chriss took over in September 2023 and promised that his first innovation day would shock the world. The stock ran up more than 10% in a week on anticipation, then fell about 4% on the day itself, when the shock turned out to be Fastlane guest checkout, a cashback program and smarter receipts. On February 3, 2026, the board removed Chriss after branded checkout growth slowed to 1%. Chairman David Dorman explained that “the pace of change and execution was not in line with the Board’s expectations.” Enrique Lores, arriving from HP, became the company’s third permanent CEO in under three years, with CFO Jamie Miller holding the seat in between.
The $4 billion Honey acquisition deserves its own line. Bought in 2019 as a commerce and data engine, the browser extension resurfaced in December 2024 as the subject of a viral investigation alleging it substituted affiliate codes and captured commissions from the creators who promoted it. The consolidated class action filed an amended complaint in January 2026. Whatever the courts decide, the deal thesis never showed up in the income statement.
That is the pattern a buyer sees: a strategy announced, a strategy retracted, a leadership change, repeat. PayPal has not lacked for assets at any point in this stretch. It has lacked a plan that survived contact with two consecutive years.
The Turnaround By The Numbers
The current numbers describe a company managing erosion in the franchise that matters while growth accrues to the parts with thin margins. Revenue rose 4% in 2025 to $33.2 billion on $1.79 trillion of volume. Branded checkout, the business that is the point of PayPal, grew 1% in the fourth quarter and 2% in the first quarter of 2026 on a currency-neutral basis. The unbranded Braintree operation grew 11%, processing enterprise volume at margins those enterprises negotiate down annually.
Share data explains the stakes. Bernstein estimates PayPal’s share of US digital wallets has fallen to about 40%, from 90% in 2017 and 50% as recently as 2023, with Apple Pay near 20% and Shop Pay compounding at roughly 30% a year. Total active accounts stood at 439 million at the end of March, four million above the level of December 2022. Four years, four million net accounts, in a global e-commerce market that grew by hundreds of millions of buyers over the same period.
Management’s own 2026 guidance projects transaction margin dollars slightly down and adjusted earnings between a low-single-digit decline and slightly positive. Meanwhile the company repurchased $6 billion of stock over the trailing year, roughly 100 million shares. One Motley Fool analysis noted that at current rates PayPal could buy back the entire company by 2032. Repurchases at that scale relative to market value are what a business does when it cannot find anything better to fund. The market priced the stock at 8.5 times forward earnings accordingly.
What The Board Is Betting On Now
The bull case is real, which is why the bid arrived at a premium and why the board could plausibly hold out for more, even if doing so proves poor judgment. Venmo revenue grew about 20% in 2025 to $1.7 billion, with 67 million monthly actives and debit card volume up 50%. The October 2025 OpenAI partnership put PayPal’s wallet inside ChatGPT’s Instant Checkout, a real head start in agentic commerce. PYUSD reached a $4 billion market cap in March.
Even the crown jewels wobble on inspection, though. PYUSD has contracted by roughly a third since that March peak, to about $2.8 billion, while the stablecoins the bidders already own infrastructure for kept growing. Venmo’s monetization arrived a decade after its cultural peak. The agentic checkout position is a partnership with a counterparty that signs partnerships with everyone in payments.
Michael Burry, who owns the stock, called $60.50 only an opening bid and put fair value near $100. Cantor Fitzgerald’s sum-of-the-parts work lands around $70, which matches the board’s reported ask. Those estimates may even be right. The unanswered question is why the organization that produced the last five years is the one that closes the gap between $47 and $100. Value that management cannot convert is value that belongs, in practice, to whoever can, and the bidders have a recent record of conversion that PayPal does not.
The July 28 Test
PayPal reports second-quarter earnings on July 28, and the print now functions as a referendum on the rejection. Lores needs branded checkout visibly reaccelerating, Venmo compounding, and credible detail on where PYUSD and the agentic distribution deals produce revenue. He needs it this quarter and then every quarter for several years, because that is what beating $53 billion on a discounted basis requires. He has been in the chair since March.
The first quarter previewed the standard the board must now clear, and the market’s mood about it. Revenue grew 7% to $8.4 billion, ahead of estimates, and the stock sagged anyway because guidance stayed cautious. That is the trap of a credibility deficit: beats get discounted, promises get ignored and the discount compounds until someone external offers to end the argument with cash. Stripe and Advent made exactly that offer, financing attached. The board declined it on behalf of a plan whose author has held the job for five months.
Stripe and Advent lose almost nothing by waiting. The financing is assembled, the logic of the deal does not decay, and every quarter that resembles the last one moves shareholders toward the bidders’ side of the table. PayPal has spent five years demonstrating that owning excellent assets and compounding them are different skills. The board has now wagered $53 billion of other people’s money that the second skill has finally shown up. The visible evidence consists of a CEO hired twenty weeks ago and a plan shareholders have not seen. On July 28 the invoice for that confidence starts arriving, one quarter at a time.
Source: Forbes