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Shares of PayPal (NASDAQ:PYPL) are up more than 6% in premarket Wednesday after the Wall Street Journal reported activist investor Elliott Management has a stake in the fintech business. The report didn’t disclose the size of Elliott’s stake and its intentions.
This news doesn’t come as a surprise, given that PayPal shares have plummeted in the recent 12 months – going from $300+ to yesterday’s close of $77.04. The company doesn’t have much debt and is seen as an attractive target for activist investors.
Recently, a Gordon Haskett analyst discussed PayPal as a potential target for Pershing Square and Third Point.
The DJ reported recently that Elliott Management has also built a sizeable stake in Pinterest (NYSE:PINS), another company that saw its shares tumble recently.
Shares of PayPal were downgraded at Wolfe Research to Peer Perform from Outperform last week.
“We believe shares are likely to remain range-bound near-to-medium term given fears surrounding macro/recession sensitivity, fears over competitive pressures, uncertainty around management changes and longer-term growth rates,” a Wolfe analyst wrote in a note.
PayPal is set to report its second quarter earnings next Tuesday.
