Following the unveiling of PayPal’s forthcoming CEO, the payment behemoth recorded a downturn in its stock prices. Just after the revelation, the stock valuation decreased by 3%, positioning it just shy of the $60 benchmark. The looming exit of Dan Schulman, steering the company for nearly a decade, is believed to be the trigger behind this market reaction. Speculations around his successor led to a marked decrease in the company’s valuation, bringing its market capitalization to approximately $300 billion.
PayPal’s stock movement concerns the market
The market’s reception to Alex Chriss, Schulman’s anointed successor, seems less than warm. Post the announcement, PayPal’s shares tumbled to $59. Previously, Chriss was pivotal in orchestrating a whopping $12 billion Mailchimp acquisition for Intuit. His social media footprints also hint at an interest in crypto, blockchain, and related digital assets. The stock decline can also be attributed to the company’s latest decision to stop crypto operations in the UK amidst unclear regulations.
Contrarily, Schulman has consistently championed the cause of cryptocurrency. Last year, he propagated the idea of a seismic shift underway in the financial landscape, focusing on the nascent stage of crypto and digital currencies. “Schulman’s impending departure has cast a shadow on PayPal’s stock trajectory,” pointed out Trevor Williams, a seasoned fintech analyst with Jefferies.
Meanwhile, Harshita Rawat from AB Bernstein, while acknowledging Chriss’s lack of market popularity as highlighted by Fortune, suggests that his outsider perspective might be the breath of fresh air PayPal needs. Both Rawat and Williams concur that Chriss’s external vantage point might rejuvenate the organization.
As a side note, PayPal’s entry into the cryptocurrency sphere with its newly minted token faced pointed questions from the leading Democrat of the House Financial Services Committee, Maxine Waters. She underscored the timing of this token launch, given the prevailing ambiguities surrounding stablecoin regulations.
