YouTube reportedly supports PayPal's PYUSD stablecoin payouts to U.S. content creators.
- PayPal (PYPL) shares fell 0.03% after Baird downgraded it from ‘Outperform’ to ‘Neutral’ and lowered its price target from $83 to $66.
- Baird's downgrade was influenced by PayPal CFO Jamie Miller's prediction of slow and uneven transaction volumes for the company’s fourth quarter.
- As per Fortune, YouTube has permitted eligible creators to receive PayPal's stablecoin (PYUSD).
PayPal (PYPL) shares fell on Friday after Baird changed its rating from ‘Outperform’ to ‘Neutral’ and lowered its price target from $83 to $66.
PayPal’s stock was trading at $61.67, down 0.03% in morning trade. On Stocktwits, PYPL’s retail sentiment was down from its previous ‘bearish’ rating to a ‘neutral’ zone in the last 24 hours, amid ‘normal’ levels of chatter.
Baird Downgrade Weighs on Shares
The investment firm said that PayPal's shares are likely to stay in a range until the company shows that it can keep improving market share, making it less likely that they will be re-rated soon, as per TheFly.
Even though Baird lowered its rating, it still maintained a positive long-term outlook on PayPal, pointing out future chances to improve branded checkout, speed up Venmo monetization, and build infrastructure for automated commerce and payments.
According to Jamie Miller, PayPal's Chief Financial Officer, the transaction volumes are expected to be slow and uneven in the fourth quarter (Q4) compared to the third, which has pushed Baird to lower its rating, as per Investing.com. PayPal's net revenue went up in the third quarter (Q3) compared to the same time last year, due to more total payment volume, as per its earnings report.
YouTube PYUSD Rollout
The downgrade follows positive news for PayPal’s stablecoin strategy. A Google spokesperson reportedly said earlier today that YouTube is adding a feature that lets U.S. creators get paid in PayPal's stablecoin, as per Fortune. This makes YouTube the first major Web2 platform to pay out creators in stablecoins.
Earlier in the third quarter, PayPal added the option for people who get paid to get their money in PYUSD. YouTube decided to give eligible creators the option to receive stablecoins as payment. These creators get a cut of the money made from content published on the site.
The present downgrade is not an isolated incident. On Thursday, Bank of America downgraded PayPal's rating to ‘Neutral’ from ‘Buy’ and cut its price target from $93 to $68, stating that the company's slower-than-expected growth improvement "limits near-term upside."
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