PayPal Holdings, Inc. operates a technology platform that enables digital payments on behalf of merchants and consumers worldwide. It operates a two-sided network at scale that connects merchants and consumers that enables its customers to connect, transact, and send and receive payments through online and in person, as well as transfer and withdraw funds using various funding sources, such as bank accounts, PayPal or Venmo account balance, PayPal and Venmo branded credit products comprising its installment products, credit and debit cards, and cryptocurrencies, as well as other stored value products, including gift cards and eligible rewards. The company provides payment solutions under the PayPal, PayPal Credit, Braintree, Venmo, Xoom, Zettle, Hyperwallet, Honey, and Paidy names. The company was founded in 1998 and is headquartered in San Jose, California.

PayPal Holdings, Inc.

PayPal Holdings PYPL has steadily deepened its crypto involvement since 2020, now offering major tokens and stablecoin services. In April 2025, it added Chainlink (LINK) and Solana (SOL) to its PayPal and Venmo platforms, broadening user access to diverse blockchain ecosystems. This expansion reinforces its strategy to become a go-to gateway for tokenized finance.
Central to PayPal’s crypto ambition is PayPal USD (“PYUSD”), launched in August 2023. Recently, PayPal announced that it is expanding PYUSD to Layer-2 blockchains, beginning with Arbitrum. This deployment offers developers a low-cost, high-speed option for PYUSD integration, pairing the stablecoin’s trusted backing with Arbitrum’s efficient transaction capabilities.
In June, PayPal announced plans to expand its stablecoin, PYUSD, to the Stellar blockchain, pending approval from the New York State Department of Financial Services. Stellar is recognized for enabling fast transactions, minimal fees and practical applications in everyday financial use. This move would enhance PYUSD’s payment capabilities by offering a cost-efficient, fast alternative to Ethereum and Solana, enabling broader use in commerce, micro-financing, and global transactions through improved integration and scalability.
A strategic tie up with Coinbase in April 2025 allows fee-free PYUSD purchases, 1:1 redemption, and co exploration of new use cases for PYUSD in DeFi and onchain platforms. This alliance brings PYUSD directly into the exchange ecosystem, enhancing consumer, merchant and institutional adoption, especially as Coinbase waives fees. Earlier, PayPal also rolled out crypto for business accounts, enabling merchants to buy, hold, sell and transfer crypto assets directly via the platform.
How Are Block and Coinbase Global Expanding in This Space?
Block, Inc. XYZ is set to join the S&P 500, marking another milestone in crypto’s push into the financial mainstream. Block has integrated Bitcoin through its Cash App, enabling peer to peer transactions and investing. It invested heavily in BTC treasury holdings and rolled out Bitcoin lending pilot programs. Its Square Crypto initiative focuses on Bitcoin developer grants and Lightning Network adoption to boost Bitcoin’s payment utility.
Coinbase Global COIN, the largest U.S. crypto exchange, offers trading, staking, custodial services and launched its Payments platform, including stablecoin support. It waived fees for PYUSD, expanded institutional services and invests in Layer 2 scaling (like Base) to bolster real world crypto use.
PYPL’s Price Performance, Valuation and Estimates
Shares of PayPal have declined 13.1% year to date, underperforming both the broader industry as well as the S&P 500 Index.
Image Source: Zacks Investment Research
From a valuation standpoint, PayPal shares are trading cheap, as suggested by the Value Score of A. In terms of forward 12-month P/E, PYPL stock is trading at 13.70X compared with the Zacks Financial Transaction Services industry’s 21.96X.
Image Source: Zacks Investment Research
PayPal’s estimate revisions reflect a positive trend. The Zacks Consensus Estimate for second-quarter and full-year 2025 and full-year 2026 EPS has been revised upward over the past week. The Zacks Consensus Estimate for 2025 EPS suggests 9.46% growth year over year, while the same for 2026 calls for 11.46% growth year over year.
Image Source: Zacks Investment Research
At present, PayPal carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Can PayPal's Crypto Strategy Give It a Competitive Edge?

DocuSign DOCU is redefining agreement management with its Intelligent Agreement Management (IAM) platform, an AI-driven solution that has quickly become the fastest-growing new product in the company’s history. Positioned well beyond the scope of traditional e-signature tools, IAM represents a strategic evolution in how businesses manage the lifecycle of agreements.
A key strength of the IAM platform lies in its robust integration with enterprise leaders such as Microsoft MSFT and Salesforce PYPL. These partnerships are not merely symbolic; they are deeply embedded within the company’s vision of enabling seamless, intelligent workflows across the tools organizations already rely on. Whether a user is drafting a contract within Microsoft Word or managing customer relationships in Salesforce’s CRM, IAM ensures documents move efficiently and securely through automated processes.
The Microsoft integration enables professionals to initiate, track, and manage agreements directly from Microsoft 365 applications, thereby eliminating workflow disruptions and enhancing operational efficiency. Similarly, the Salesforce integration enables sales, legal and procurement teams to collaborate effortlessly within the CRM environment, improving visibility and reducing turnaround time for agreements. These integrations strengthen customer dependency, effectively anchoring the IAM platform within the core infrastructure of large enterprises. This strategic alignment not only increases the platform’s reach but also significantly improves user retention.
IAM underscores DocuSign’s broader transition into a comprehensive digital agreement platform, designed to support every stage of the contract lifecycle, from creation and negotiation to execution and analysis. With AI-driven insights, the platform enhances decision-making, speeds up workflows and reinforces compliance and accuracy.
By embedding itself within widely used enterprise ecosystems, DocuSign is building a level of stickiness that’s hard to displace. This strategic positioning makes IAM not just a useful tool but a mission-critical component of digital transformation initiatives. As more organizations embrace automation and intelligent workflows, DocuSign’s IAM, driven by advanced integrations and AI, is emerging as a cornerstone of the future-forward enterprise.
DOCU’s Price Performance, Valuation, Estimates
The stock has declined 12% year to date compared with the industry’s 16% rally.
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From a valuation standpoint, DOCU trades at a forward price-to-earnings ratio of 21.73, well above the industry’s 40.18. It carries a Value Score of D.
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The Zacks Consensus Estimate for DOCU’s second-quarter fiscal 2025 earnings has been on the rise over the past 60 days.
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DOCU stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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DocuSign's IAM: Automating Agreements, Redefining Enterprise

In early trading on Monday, shares of PayPal Holdings topped the list of the day's best performing components of the Nasdaq 100 index, trading up 2.6%. Year to date, PayPal Holdings has lost about 10.8% of its value.
And the worst performing Nasdaq 100 component thus far on the day is Ansys, trading down 4.7%. Ansys is showing a gain of 11.0% looking at the year to date performance.
Two other components making moves today are Marvell Technology, trading down 2.1%, and Intel, trading up 2.5% on the day.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Nasdaq 100 Movers: ANSS, PYPL

Key Points
Nvidia and Palantir Technologies are the faces of the artificial intelligence (AI) revolution.
Though Nvidia and Palantir have made their shareholders notably richer, both stocks are arguably in a bubble.
Three phenomenal companies have the tools and intangibles needed to leapfrog today's hottest stocks over the coming 10 years.
For the better part of the last three years, no trend has been hotter on Wall Street than the rise of artificial intelligence (AI). Giving software and systems the tools to make split-second decisions without human oversight is a game-changer for most industries around the globe.
Though a long list of companies has benefited from the evolution of AI, none are the face of the movement quite like graphics processing unit (GPU) kingpin Nvidia (NASDAQ: NVDA) and AI-driven data-mining specialist Palantir Technologies (NASDAQ: PLTR). Nvidia has gained more than $3.8 trillion in market value since the start of 2023, while Palantir stock has surged by roughly 2,250% over the same span.
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Nvidia and Palantir may be in a bubble
Nvidia's claim to fame is its Hopper and Blackwell GPUs, which account for the lion's share of GPUs currently deployed in AI-accelerated data centers. With AI-GPU scarcity persisting, Nvidia has enjoyed a sizable backlog for its hardware and has been able to consistently charge a triple-digit percentage premium for its GPUs, relative to its external competition.
Meanwhile, Palantir has benefited from its two AI-fueled platforms, Gotham and Foundry, being irreplaceable at scale. Federal governments rely on Gotham to support military mission planning and execution, as well as data analytics. As for Foundry, it helps businesses make sense of their data and assists in streamlining their operations. Gotham has played the biggest role in sustaining Palantir's sales growth and pushing the company to recurring profitability.
Despite this overwhelming success, there's a realistic chance that Nvidia and Palantir are both in a bubble.
For starters, every next-big-thing innovation for more than three decades has endured an early innings bubble-bursting event. It takes time for all technologies to mature, and the vast majority of companies deploying AI solutions are nowhere close to having optimized them, as of yet. If an AI bubble forms and bursts, no two companies would arguably be hit harder than Nvidia and Palantir.
Their valuations are, potentially, an even bigger concern. Whereas most industry leaders on the cutting-edge of a next-big-thing technology have topped out at price-to-sales (P/S) ratios of 30 to 40, Palantir is nearing a P/S ratio of almost 121! As for Nvidia, it's approaching a P/S ratio of 29, which is more than double the trailing-12-month P/S multiple of any of its "Magnificent Seven" peers.
If history rhymes and the AI bubble bursts, other brand-name stocks will have an opportunity to leapfrog Nvidia ($4.18 trillion) and Palantir ($356 billion) in the valuation department by 2035. What follows are three magnificent stocks with valuations below both Nvidia and Palantir that can surpass them over the next 10 years.
Alibaba Group: current market cap of $276 billion
One of the more logical candidates to leapfrog Nvidia and Palantir is China-based e-commerce and AI juggernaut Alibaba Group (NYSE: BABA), which is only $80 billion away from Palantir's market cap but a good $3.9 trillion below Nvidia.
Alibaba's foundational operating segment is its e-commerce marketplace. Based on a research report from DBS Treasures, Alibaba's Taobao and Tmall collectively accounted for an estimated 41% of China's gross merchandise value for online retail platforms in 2024. Even though online retail sales generate relatively low margins, China's burgeoning middle class sets Alibaba's e-commerce platforms up for sustained growth.
What's even more intriguing than Alibaba's online retail sales potential is its cloud infrastructure service platforms and artificial intelligence ties. Alibaba Cloud was responsible for one-third of all cloud infrastructure service spending in mainland China during the quarter ended in March, according to Canalys. The incorporation of generative AI solutions has the potential to accelerate and/or sustain double-digit sales growth for this considerably higher-margin segment.
Don't overlook Alibaba's pristine balance sheet, either. It closed out March with $59 billion in cash, cash equivalents, short-term investments, and equity securities, generating roughly $3.8 billion in net cash from its operating activities during the first three months of the year. Perhaps it's no surprise that Alibaba is supporting a healthy share repurchase program and is able to invest aggressively in an assortment of higher-growth and higher-margin innovations.
PayPal Holdings: current market cap of $71 billion
A second magnificent stock with all the tools and intangibles needed to surpass Nvidia's and Palantir's respective market caps over the next 10 years is fintech leader PayPal Holdings (NASDAQ: PYPL). PayPal certainly has the biggest climb, with a current market of "just" $71 billion. But keep in mind that my forecast implies a commensurate decline in the valuations of both Nvidia and Palantir by 2035.
Based on estimates from research and consulting firm Roots Analysis, the global fintech addressable market is projected to grow from $222 billion in 2024 to north of $1.8 trillion by 2035. Though there's growing competition in digital payments, PayPal finds itself in pole position for this sizable global opportunity.
While PayPal's active account growth has left a bit to be desired over the last two years, most of its key performance indicators (KPIs) have been marching in the right direction. Since the end of 2020, total payment volume transacted on PayPal's digital platforms has expanded from $936 billion to an annual run rate of $1.67 trillion, based on its quarter ending in March 2025.
Meanwhile, the average number of payments completed by active accounts over the trailing-12-month period jumped from 40.9 to 59.4 during the same time frame. In other words, active accounts are substantially more engaged than they were a little over four years ago, which is a recipe for gross profit expansion over time.
The icing on the cake for PayPal, beyond its opportunity to expand into underbanked emerging markets, is its hearty capital-return program. PayPal has reduced its outstanding share count by more than 20% over the last decade, which should have a demonstrably positive impact on its earnings per share (EPS).
Intuitive Surgical: current market cap of $184 billion
The third magnificent stock that has the potential to blow past Nvidia and Palantir by 2035 is robotic-assisted surgical systems developer Intuitive Surgical (NASDAQ: ISRG), which currently trails Palantir by about $172 billion and Nvidia by roughly $4 trillion.
The beauty of most healthcare stocks is their highly defensive nature. No matter how well or poorly the U.S. economy and/or stock market are performing, people will still develop ailments and require prescription drugs, medical devices, and preventative services/surgeries. This leads to steady operating cash flow year after year for most healthcare businesses.
On a more company-specific basis, Intuitive Surgical has a vice-like grip on the robotic-assisted surgical market share. The 367 da Vinci surgical systems placed during the first quarter pushed Intuitive Surgical beyond 10,000 system installations this century. While this might not sound like a huge number, the high cost of these systems, coupled with the time it takes to train surgeons to use the da Vinci surgical system, keeps buyers exceptionally loyal to the company.
Furthermore, Intuitive Surgical's revenue breakdown has become more favorable from a margin standpoint over time. During the 2000s, most of its revenue originated from selling its high-priced but costly-to-build da Vinci surgical system. Now, a majority of its sales come from instruments and accessories for procedures and system servicing. These are high-margin sales channels that are allowing EPS to grow at a faster pace than revenue.
The final puzzle piece is that its surgical systems are still just scratching the surface in terms of utility. Moving into thoracic, colorectal, and generalized soft tissue procedures opens new doors that can sustain a double-digit growth rate for perhaps the next 10 years, if not well beyond.
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Sean Williams has positions in PayPal. The Motley Fool has positions in and recommends Intuitive Surgical, Nvidia, Palantir Technologies, and PayPal. The Motley Fool recommends Alibaba Group and recommends the following options: long January 2027 $42.50 calls on PayPal and short June 2025 $77.50 calls on PayPal. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Prediction: 3 Magnificent Stocks That'll Be Worth More Than Nvidia and Palantir by 2035

Investors eyeing a purchase of PayPal Holdings Inc (Symbol: PYPL) shares, but tentative about paying the going market price of $73.78/share, might benefit from considering selling puts among the alternative strategies at their disposal. One interesting put contract in particular, is the December 2027 put at the $50 strike, which has a bid at the time of this writing of $3.90. Collecting that bid as the premium represents a 7.8% return against the $50 commitment, or a 3.2% annualized rate of return (at Stock Options Channel we call this the YieldBoost).
Selling a put does not give an investor access to PYPL's upside potential the way owning shares would, because the put seller only ends up owning shares in the scenario where the contract is exercised. And the person on the other side of the contract would only benefit from exercising at the $50 strike if doing so produced a better outcome than selling at the going market price. (Do options carry counterparty risk? This and six other common options myths debunked). So unless PayPal Holdings Inc sees its shares decline 32.3% and the contract is exercised (resulting in a cost basis of $46.10 per share before broker commissions, subtracting the $3.90 from $50), the only upside to the put seller is from collecting that premium for the 3.2% annualized rate of return.
Below is a chart showing the trailing twelve month trading history for PayPal Holdings Inc, and highlighting in green where the $50 strike is located relative to that history:
The chart above, and the stock's historical volatility, can be a helpful guide in combination with fundamental analysis to judge whether selling the December 2027 put at the $50 strike for the 3.2% annualized rate of return represents good reward for the risks. We calculate the trailing twelve month volatility for PayPal Holdings Inc (considering the last 250 trading day closing values as well as today's price of $73.78) to be 38%. For other put options contract ideas at the various different available expirations, visit the PYPL Stock Options page of StockOptionsChannel.com.
In mid-afternoon trading on Friday, the put volume among S&P 500 components was 2.83M contracts, with call volume at 3.14M, for a put:call ratio of 0.90 so far for the day, which is unusually high compared to the long-term median put:call ratio of .65. In other words, there are lots more put buyers out there in options trading so far today than would normally be seen, as compared to call buyers. Find out which 15 call and put options traders are talking about today.
Also see:
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Agree To Buy PayPal Holdings At $50, Earn 7.8% Using Options

Affirm Holdings Inc AFRM, a key player in the Buy Now, Pay Later (BNPL) space, is focusing on vertical integration to boost its profitability in a competitive and capital-heavy industry. With increasing pressure from regulators, high interest rates and stiff competition from rivals, AFRM’s approach to take control of more of the BNPL value chain could be a game-changer.
At its core, vertical integration means the company is taking charge of everything — from underwriting and loan origination to servicing and collections in many cases — rather than leaning heavily on third-party banks or partners. For instance, AFRM now relies on its own in-house algorithm to assess creditworthiness instead of solely depending on traditional credit scores. This shift enables better risk-based pricing, quicker approvals and greater control over loan performance.
One of the key aspects of this strategy is the increasing reliance on in-house funding. By blending its balance sheet with warehouse credit funding, Affirm will be able to lessen its dependence on expensive external capital, which ultimately boosts its net interest margin. This shift in structure could help soften the effects of broader economic challenges, like the rising cost of funds, which is a significant barrier to profitability for many BNPL companies.
In the third quarter of fiscal 2025, the company’s total revenues improved 36% year over year. Also, its adjusted operating margin improved 860 basis points year over year in the same quarter. AFRM’s strategy of vertical integration isn’t just a smart defensive tactic — it’s a key to long-term profitability.
How Are Competitors Faring?
Some of AFRM’s competitors in the BNPL space are PayPal Holdings, Inc. PYPL and Block, Inc. XYZ.
PayPal controls the entire value chain, handling everything from underwriting and transaction processing to collections and customer support. PayPal’s deep integration with merchants and large global user base allows it to offer BNPL services efficiently without incurring high customer acquisition costs.
Afterpay, part of Block, takes a different approach than AFRM by being less vertically integrated. It acts more like a BNPL facilitator that focuses on merchants, offering interest-free installment plans while depending on Block’s access to capital for its funding.
Affirm’s Price Performance, Valuation & Estimates
Over the past year, AFRM’s shares have skyrocketed 131.9% compared with the industry’s growth of 41.8%.
Image Source: Zacks Investment Research
From a valuation standpoint, AFRM trades at a forward price-to-sales ratio of 5.64, slightly below the industry average of 5.7. AFRM carries a Value Score of F.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Affirm’s fiscal 2025 earnings implies 101.8% growth from the year-ago period.
Image Source: Zacks Investment Research
Affirm currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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How Vertical Integration Is Fueling Affirm's Profitability in BNPL

Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in PayPal Holdings Inc (Symbol: PYPL), where a total volume of 57,104 contracts has been traded thus far today, a contract volume which is representative of approximately 5.7 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 55.3% of PYPL's average daily trading volume over the past month, of 10.3 million shares. Especially high volume was seen for the $76 strike call option expiring July 18, 2025, with 4,774 contracts trading so far today, representing approximately 477,400 underlying shares of PYPL. Below is a chart showing PYPL's trailing twelve month trading history, with the $76 strike highlighted in orange:
Novavax, Inc. (Symbol: NVAX) options are showing a volume of 25,979 contracts thus far today. That number of contracts represents approximately 2.6 million underlying shares, working out to a sizeable 55.1% of NVAX's average daily trading volume over the past month, of 4.7 million shares. Especially high volume was seen for the $7.50 strike put option expiring January 16, 2026, with 10,001 contracts trading so far today, representing approximately 1.0 million underlying shares of NVAX. Below is a chart showing NVAX's trailing twelve month trading history, with the $7.50 strike highlighted in orange:
And AAR Corp (Symbol: AIR) saw options trading volume of 1,798 contracts, representing approximately 179,800 underlying shares or approximately 52.4% of AIR's average daily trading volume over the past month, of 343,225 shares. Particularly high volume was seen for the $85 strike call option expiring July 18, 2025, with 235 contracts trading so far today, representing approximately 23,500 underlying shares of AIR. Below is a chart showing AIR's trailing twelve month trading history, with the $85 strike highlighted in orange:
For the various different available expirations for PYPL options, NVAX options, or AIR options, visit StockOptionsChannel.com.
ETFs Holding UBNT
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QDEF YTD Return
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Notable Thursday Option Activity: PYPL, NVAX, AIR

Mastercard Incorporated MA, in collaboration with Payments and Commerce Market Intelligence and K2, has released a new report. It sheds light on how the existing international payment systems, designed to serve large corporations, fail to address the unique needs and challenges of small and medium-sized enterprises (SMEs) in Latin America.
Per the report, a significant portion of SMEs in the region are already engaged in global commerce, with three out of five currently working with international suppliers. In countries like Mexico and Brazil, 75% of SMEs have plans to expand their global partnerships. However, these ambitions are constrained by serious obstacles that SMEs often encounter, such as steep fees, unfavorable currency conversion rates and extensive payment delays.
This raises concern since SMEs are a foundational part of Latin America’s economy, representing 98% of the business ecosystem and contributing around 60% of employment.
To address these issues, Mastercard is leveraging its Mastercard Move platform, which encompasses a broad suite of money movement capabilities tailored to the realities of SMEs. Mastercard Move aims to improve cross-border payments by minimizing costs through fewer intermediaries, offering complete transparency with real-time tracking of fees and delivery times, and enabling faster settlement—often same-day or real-time—in more than 150 global markets.
The increased usage of Mastercard Move is expected to expand the SME client base across Latin America and boost its cross-border volumes. Its cross-border volumes advanced 15% on a local currency basis in the first quarter of 2025.
How are Competitors Faring?
Some of Mastercard’s competitors in the Latin American market include PayPal Holdings, Inc. PYPL and Visa Inc. V.
PayPal operates in multiple Latin American nations, including Brazil, Argentina, Mexico and Colombia, where it provides a range of financial and payment services, per reports. Its cross-border total payment volume grew 3% year over year in the first quarter of 2025.
Visa operates in Latin America through strategic initiatives like its acquisition of Pismo and planned majority stake in Prosa, supporting digital payments and real-time processing across the region. Visa’s cross-border volume improved 13% year over year in the second quarter of fiscal 2025.
Mastercard’s Price Performance, Valuation & Estimates
Shares of Mastercard have gained 23.8% in the past year compared with the industry’s 22.4% growth.
Image Source: Zacks Investment Research
From a valuation standpoint, MA trades at a forward price-to-earnings ratio of 31.87, above the industry average of 22.05.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Mastercard’s 2025 earnings implies a 9.7% rise from the year-ago period. The consensus mark for revenues indicates 13.3% year-over-year growth.
Image Source: Zacks Investment Research
MA currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Small Biz, Big Roadblocks: Mastercard to Smoothen Cross-Border Ride

For Immediate Release
Chicago, IL – July 17, 2025 – Zacks Equity Research shares Affirm Holdings AFRM as the Bull of the Day and JAKKS Pacific JAKK as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Mastercard Inc. MA, Visa Inc. V and PayPal Holdings, Inc. PYPL.
Here is a synopsis of all five stocks:
Affirm Holdings, a Zacks Rank #1 (Strong Buy), is a financial technology company specializing in payment solutions that provide consumers with flexible, transparent installment loans. By partnering with a diverse range of merchants, Affirm enables customers to pay for purchases over time.
The stock is displaying relative strength and has been making a series of higher highs. The price movement is a sign of strength as we head into the second half of the year. Increasing volume has attracted investor attention as buying pressure accumulates in this top-ranked stock.
Affirm is part of the Zacks Financial Transaction Services industry group, which currently ranks in the top 31% out of more than 250 industries. Because this group is ranked in the top half of all Zacks Ranked Industries, we expect it to outperform the market over the next 3 to 6 months, just as it has over the past few months.
Historical research studies suggest that approximately half of a stock's price appreciation is due to its industry grouping. In fact, the top 50% of Zacks Ranked Industries outperforms the bottom 50% by a factor of more than 2 to 1.
It's no secret that investing in stocks that are part of leading industry groups can give us a leg up relative to the market. By focusing on leading stocks within the top industries, we can dramatically improve our stock-picking success.
Company Description
Affirm Holdings operates a payment network in the United States, Canada, and internationally. Its platform includes point-of-sale payment solutions for consumers and merchants along with a consumer-focused app.
The company boasts over 300,000 active merchants covering small businesses, large enterprises, direct-to-consumer brands, and brick-and-mortar stores. Its tools help merchants to boost sales and enhance customer engagement.
Affirm's top-line momentum remains strong, supported by rising adoption of Affirm Cards and entry into high-growth verticals like gaming. A robust merchant network is fueling expansion with new alliances across travel, healthcare, and international markets.
Partnerships with Adyen and Shopify are aiding European growth. Affirm's cloud-native platform uses machine learning and AI to optimize underwriting, improve efficiency and automate customer service.
Earnings Trends and Future Estimates
Affirm has built up an impressive reporting history, surpassing earnings estimates in each of the past four quarters. The company delivered a trailing four-quarter average surprise of 102%.
Back in May, Affirm reported fiscal third-quarter earnings of 1 cent per share, which marked a 111% surprise over the -$0.09/share consensus estimate. Higher transactions and robust repeat customer engagement also boosted performance.
For the company's fiscal fourth quarter, analysts are expecting Affirm to deliver year-over-year EPS growth of 164% (9 cents per share) on nearly 27% higher revenues ($835 million). Affirm is scheduled to deliver the quarterly results in late August.
Looking further out, analysts remain bullish on the stock and have raised fiscal 2026 earnings estimates by 5.71% in the past 60 days. The Zacks Consensus Estimate now stands at 74 cents per share, reflecting staggering growth of 2,355% relative to the prior year.
Let's Get Technical
This market leader has seen its stock advance more than 80% off the April lows. Only stocks that are in extremely powerful uptrends are able to experience this type of outperformance. This is the kind of stock we want to include in our portfolio – one that is trending well and receiving positive earnings estimate revisions.
The stock has been making a series of higher highs over the past few months. With both strong fundamental and technical indicators, AFRM stock is poised to continue its outperformance.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. As we know, Affirm has recently witnessed positive revisions. As long as this trend remains intact (and AFRM continues to deliver earnings beats), the stock will likely continue its bullish run.
Bottom Line
Backed by a leading industry group and history of earnings beats, it's not difficult to see why AFRM stock is a compelling investment. Robust fundamentals combined with an appealing technical trend certainly justify adding shares to the mix.
Affirm has achieved strong revenue growth through diverse income streams including merchant network fees, interest from loans, and virtual card revenues. Advanced machine learning and predictive models power the company's cloud-based, data-driven platform.
Recent positive earnings estimate revisions should also serve to create a 'floor' in terms of any sudden or unexpected downside moves. If you haven't already done so, be sure to put AFRM on your shortlist.
JAKKS Pacific produces, sells, and distributes toys and related products. A multi-line, multi-brand company, JAKKS Pacific also sells electronics, kids indoor and outdoor furniture, and sporting goods. Its products include action figures, toy vehicles, dolls, inflatable tents, wagons, costumes, and other child-related accessories.
The company sells its products through both in-house and independent sales teams to mass-market retail chains, grocery stores, toy specialty stores, and wholesalers. JAKKS was incorporated in 1995 and is headquartered in Santa Monica, California.
The toy company faces several notable headwinds. Over 75% of its business operates on a Freight-On-Board (FOB) basis, with products sold either directly at the factory or through ports in China. Revenues have been under pressure in recent quarters due to lower orders in key categories. Tariff uncertainty, increased expenses, and depleting liquidity remain top concerns.
The Zacks Rundown
A Zacks Rank #5 (Strong Sell) stock, JAKKS is part of the Zacks Toys – Games – Hobbies industry, which currently ranks in the bottom 2% out of approximately 250 industries. Because this industry is ranked in the bottom half of all Zacks Ranked Industries, we expect it to underperform the market over the next 3 to 6 months.
Stocks in the bottom tiers of industries can often be intriguing short candidates. While individual stocks have the ability to outperform even when they're part of a lagging industry, the inclusion in a weaker group serves as a headwind for any potential rallies and the journey forward is that much more difficult.
JAKK stock has been severely underperforming the market off the April lows. The stock has failed to show any real momentum and represents a compelling short opportunity as we head further into 2025.
Recent Earnings Misses and Deteriorating Outlook
JAKKS Pacific has fallen short of earnings estimates in four of the past six quarters. The company posted a trailing four-quarter average earnings miss of -283%. Consistently falling short of earnings estimates is a recipe for underperformance, and JAKK is no exception.
The kids' accessories company has been on the receiving end of negative earnings estimate revisions as of late. Looking at the full year, analysts have slashed estimates by a whopping -38.26% in the past 60 days. The 2025 Zacks Consensus EPS Estimate is now $2.34 per share, reflecting negative growth of -38% relative to last year.
Falling earnings estimates are a huge red flag and need to be respected. Negative growth year-over-year is the type of trend that bears like to see.
Let's Get Technical
JAKK stock has experienced what is known as a "death cross," whereby the stock's 50-day moving average crosses below its 200-day moving average. Shares would have to make an outsized move to the upside and show increasing earnings estimate revisions to warrant taking any long positions. The stock has fallen more than 40% since February, all while the general market returned to new heights.
Final Thoughts
A deteriorating fundamental and technical backdrop show that this stock is not set to hit new highs anytime soon. The fact that JAKKS Pacific is included in a weak industry group simply adds to the growing list of concerns.
A history of earnings misses will likely serve as a ceiling to any potential rallies, nurturing the stock's downtrend.
JAKK shares continue to experience substantial volatility and have widely underperformed the market lately. With negative earnings estimate revisions continuing to pile up, this stock should be avoided as there are plenty of better alternatives in the current market environment.
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Why Do Merchants Trust Mastercard in a Risky Digital World?
Mastercard Inc. continues to gain the trust of merchants in today's digital world, where payment fraud and cyber threats are on the rise. The company's proactive security infrastructure and established industry reputation keep it at the top of merchant preference, which supports its volume growth. MA has invested heavily in cybersecurity.
The company has rolled out AI-driven fraud detection tools, along with biometric authentication and tokenization technology that swaps out card details for unique identifiers, significantly lowering the risk of theft. Its exclusive Cyber Secure tool offers real-time risk assessments, enabling businesses to identify and tackle vulnerabilities before they can be taken advantage of. MA also launched Mastercard Agent Pay, which combines its agentic tokens with cybersecurity, fraud and franchise regulations. These will assist Microsoft and other partners in enabling safe, easy and programmable transactions across AI platforms.
In addition to technology, MA is building trust via strategic partnerships and global compliance. The company collaborates closely with merchants and regulators to keep up with changing data privacy standards like GDPR and PCI DSS. Also, its acquisition of RiskRecon, a cybersecurity company, has boosted its ability to keep an eye on third-party risks, something that can be challenging for SMEs to handle on their own. MA also emphasizes education and transparency. With initiatives like the Trust Center and global fraud insights, it helps businesses stay updated.
As e-commerce keeps expanding and digital fraud gets trickier, Mastercard's multi-layered defense model, real-time intelligence and collaborative ecosystem provide merchants with the confidence to concentrate on growth without worrying about threats.
How Are Competitors Faring?
Some of MA's competitors adopting AI to improve operations include Visa Inc. and PayPal Holdings, Inc..
Visa is also making significant strides in cybersecurity. Visa poured over $10 billion over the past five years into AI and fraud prevention technologies, allowing their systems to sift through millions of transactions in real time to spot any unusual activity.
PayPal is actively using AI to improve its platform in a number of ways, from streamlining checkout procedures to giving developers more flexible workflows. These AI-powered solutions demonstrate PayPal's dedication to increasing productivity, customizing communications and strengthening security for both customers and companies.
Mastercard's Price Performance, Valuation & Estimates
In the year-to-date period, MA's shares have gained 4.3% compared with the industry's rise of 2.4%.
From a valuation standpoint, MA trades at a forward price-to-earnings ratio of 31.59, above the industry average of 21.85. MA carries a Value Score of D.
The Zacks Consensus Estimate for Mastercard's 2025 earnings implies 9.6% growth from the year-ago period.
Mastercard currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
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This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.
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Affirm and JAKKS Pacific have been highlighted as Zacks Bull and Bear of the Day

Affirm Holdings, Inc. AFRM has developed a robust system to handle a higher number of transactions by leveraging its proprietary technology infrastructure, deep data capabilities and efficient risk models. Furthermore, Affirm integrates easily with merchant APIs, which helps maintain seamless transaction flows across a growing network of roughly 358,000 active merchants as of March 31, 2025.
The company’s revenues are closely tied to the number of transactions processed on its platform, as each transaction generates potential revenues through either merchant fees or consumer interest income. Transaction count increased 46% year over year in the third quarter of fiscal 2025. Affirm offers flexible financing solutions including Pay-in-four biweekly plans, 0% APR monthly installments and interest-bearing loans.
Despite a surge in transactions, concerns arise as the share of Affirm’s 0% APR in total GMV is growing. 0% APR monthly instalment GMV jumped 44% YoY in the fiscal third quarter 2025. AFRM generally makes less money from these loans compared with high-interest-bearing ones and it can affect its interest margin. Nevertheless, the company is intentionally pushing 0% APR plans to attract higher-quality borrowers and boost conversion metrics, which can lower risk and improve lifetime value. Also, it earns larger merchant fees from these transactions.
If Affirm can continue scaling transaction volume while balancing its loan mix, the strategy could support sustainable growth even with thinner margins
How are Competitors Faring?
Some of Affirm’s key competitors in the buy now, pay later (BNPL) space include PayPal Holdings, Inc. PYPL and Visa Inc. V, both of which enjoy a strong presence in the BNPL market.
PayPal offers BNPL services under the PayPal Pay Later brand across the US, UK, France, Germany, and Japan (via its Paidy brand). It processed 6 billion transactions in the first quarter of 2025. PYPL’s net revenues rose 1% year over year to $7.8 billion.
Visa offers BNPL solutions via issuers and fintechs. Its processed transactions increased 9% year over year in the second quarter of fiscal 2025. V’s total revenues advanced 9% year over year, supported by year-over-year increases of 8% and 13% in payments volume and cross-border volume.
Affirm’s Price Performance, Valuation & Estimates
Shares of Affirm have surged 104.9% in the past year compared with the industry’s 42.3% growth.
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From a valuation standpoint, AFRM trades at a forward price-to-sales ratio of 5.38, below the industry average of 5.7.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Affirm’s fiscal 2025 earnings implies 101.8% improvement from the year-ago period. The consensus mark for revenues indicates 37% year-over-year growth.
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AFRM currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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PayPal Holdings, Inc.

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