Investors are gearing up in anticipation of the digital payment company’s spinoff, offering larger returns in the near future.
PayPal will commence trading Monday with a staggering market capitalization of nearly $46.6 billion. Subsequently, eBay diminishes to about $34 billion.
Experts see the overwhelming potential of PayPal, and are tipping off investors to its inevitable growth. This while eBay’s expansion rate severely decelerates as it faces stiffer competition in e-commerce.
Investors have been waiting a long time to invest in the emerging potential payment powerhouse that is PayPal.
In the second quarter alone, PayPal tallied up 169 million users and made 1.1 billion transactions. In addition, transaction volume is up 27 percent from the previous year. This clearly indicates the dramatic growth rate of PayPal that has occurred due to the public’s reliance on online shopping as well as purchasing tendencies shifting in favor of online and mobile payment channels.
Nevertheless, eBay remains a valuable investment, with 157 million buyers spending nearly $20.1 billion in the second quarter, down only 2 percent from the previous year in part due to currency exchange rates. Even with the information being revealed today, eBay currently remains more profitable than PayPal, but for how long is anyone’s guess.