Buy paypal because survey suggests credit card competition fears ‘overblown,' analyst says

Buy paypal because survey suggests credit card competition fears ‘overblown,' analyst says

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Credit Suisse reiterated its outperform rating on PayPal shares, citing survey results that revealed the online payment service's dominant market position. "Our survey found PayPal


to be more popular than credit and debit cards for online purchases in all geographies," analyst Paul Condra wrote in a note to clients Wednesday. "Survey results leave us


incrementally more positive on PYPL. In addition to its high growth assets (Venmo and Braintree), we believe legacy PayPal remains a sticky and relevant platform and concerns over losing


share to credit cards may be overblown." Condra reiterated his PayPal price target of $47, representing 10 percent upside from Tuesday's close. The analyst cited Credit


Suisse's survey of 300 people in eight countries on their online purchasing habits. It revealed PayPal was the market leader with 78 percent of consumers using the service versus 48


percent for credit cards. The online payment company did even better for international purchases with 61 percent share versus 15 percent for credit cards. The "survey shows PayPal is


more entrenched than we thought … Users rated PayPal more favorably than credit cards," he wrote. Condra also noted how 75 percent of PayPal consumers used bank accounts to fund their


accounts versus 25 percent using credit cards, which showed the firm is less dependent on its competition. The survey's respondents also said they recommended PayPal due to its


"ease of use, speed, security, customer services and widespread acceptance."