In this episode of The Intrinsic Value Podcast, Shawn O'Malley and Daniel Mahncke analyze PayPal, a fintech company that has seen a significant stock decline despite impressive headline numbers. They delve into PayPal's history, influential figures like Elon Musk and Peter Thiel, and its evolution from an eBay payment system to a standalone entity. The discussion covers PayPal's challenges, including slowing growth, increased competition from companies like Stripe and Apple Pay, and strategic missteps under previous leadership. They explore the new CEO Alex Chriss's strategy shift, focusing on high-margin businesses, streamlining operations, and potential growth areas like advertising and AI-driven commerce. The hosts debate whether PayPal is a value trap or a cash-flowing machine in a growing oligopoly, considering its fundamentals, valuation, and the potential impact of stablecoins. They also discuss the management team's incentive structure and potential for future growth, ultimately deciding on a position in PayPal with a plan to re-evaluate based on further research and community insights.
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