Why PayPal Stock Plunged 19% in 2021
Shares of digital payments behemoth PayPal Holdings (NASDAQ: PYPL) ended 2021 down 19%, according to data provided by S&P Global Market Intelligence. This performance lagged behind the S&P 500, which produced a superb return of 27% for the year. Two straight quarters of decelerating revenue growth are causing investors to question the outlook for PayPal.
PayPal benefited from the surge of online shopping during the pandemic. Sales and total payment volume (TPV) in 2020 jumped 21% and 31%, respectively, year over year. And the stock more than doubled that year. 2021 was characterized by slowing revenue growth, particularly as consumers dealt with fading government stimulus. Additionally, PayPal's margins have come under pressure in recent quarters due to rising marketing, technology, and development expenses.
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Source Fool.com
