Stock Analysis on Net

PayPal Holdings Inc. (NASDAQ:PYPL)

This company has been moved to the archive! The financial data has not been updated since May 9, 2023.

Return on Capital (ROC)

Microsoft Excel

Return on Invested Capital (ROIC)

PayPal Holdings Inc., ROIC calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1 1,747 3,793 4,527 2,151 1,833
Invested capital2 31,496 31,317 30,260 22,276 17,780
Performance Ratio
ROIC3 5.55% 12.11% 14.96% 9.66% 10.31%
Benchmarks
ROIC, Competitors4
Accenture PLC 23.93% 25.83% 26.30% 24.83%
Adobe Inc. 26.93% 29.44% 21.67% 19.74% 17.25%
Autodesk Inc. 14.20% 14.55% 21.62% 0.93%
Cadence Design Systems Inc. 23.98% 24.26% 25.05% 19.42%
CrowdStrike Holdings Inc. 12.03% 9.74% 20.78%
International Business Machines Corp. -0.68% 3.78% 3.44% 7.64%
Intuit Inc. 9.30% 17.64% 20.65% 34.71%
Microsoft Corp. 36.59% 45.56% 43.43% 38.28%
Oracle Corp. 9.70% 17.55% 11.53% 15.18%
Palo Alto Networks Inc. 19.73% 11.48% 9.91% 13.83%
Salesforce Inc. 5.42% 8.23% 5.09% 8.97%
ServiceNow Inc. 17.69% 18.88% 20.49% 19.87%
Synopsys Inc. 17.54% 11.52% 11.63% 8.35% 6.37%

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

1 NOPAT. See details »

2 Invested capital. See details »

3 2022 Calculation
ROIC = 100 × NOPAT ÷ Invested capital
= 100 × 1,747 ÷ 31,496 = 5.55%

4 Click competitor name to see calculations.

Performance ratio Description The company
ROIC A measure of the periodic, after tax, cash-on-cash yield earned in the business. PayPal Holdings Inc. ROIC deteriorated from 2020 to 2021 and from 2021 to 2022.

Decomposition of ROIC

PayPal Holdings Inc., decomposition of ROIC

Microsoft Excel
ROIC = OPM1 × TO2 × 1 – CTR3
Dec 31, 2022 5.55% = 12.85% × 0.87 × 49.39%
Dec 31, 2021 12.11% = 16.74% × 0.81 × 89.32%
Dec 31, 2020 14.96% = 24.50% × 0.71 × 86.14%
Dec 31, 2019 9.66% = 16.58% × 0.80 × 72.99%
Dec 31, 2018 10.31% = 14.93% × 0.87 × 79.42%

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

1 Operating profit margin (OPM). See calculations »

2 Turnover of capital (TO). See calculations »

3 Effective cash tax rate (CTR). See calculations »

The primary reason for the decrease in return on invested capital (ROIC) over 2022 year is the increase in effective cash tax rate (CTR).


Operating Profit Margin (OPM)

PayPal Holdings Inc., OPM calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1 1,747 3,793 4,527 2,151 1,833
Add: Cash operating taxes2 1,790 454 728 796 475
Net operating profit before taxes (NOPBT) 3,537 4,247 5,256 2,947 2,308
 
Net revenues 27,518 25,371 21,454 17,772 15,451
Profitability Ratio
OPM3 12.85% 16.74% 24.50% 16.58% 14.93%
Benchmarks
OPM, Competitors4
Accenture PLC 15.48% 16.65% 16.59% 14.89%
Adobe Inc. 36.56% 40.89% 34.42% 31.93% 35.32%
Autodesk Inc. 22.23% 23.23% 30.50% 3.88%
Cadence Design Systems Inc. 32.28% 28.51% 27.83% 21.81%
CrowdStrike Holdings Inc. 23.25% 20.74% 18.60%
International Business Machines Corp. 2.98% 10.91% 9.64% 15.99%
Intuit Inc. 21.00% 28.02% 29.42% 28.33%
Microsoft Corp. 43.28% 43.49% 38.29% 36.61%
Oracle Corp. 24.11% 40.03% 34.29% 34.21%
Palo Alto Networks Inc. 23.90% 16.95% 17.41% 16.22%
Salesforce Inc. 16.40% 20.24% 15.63% 19.12%
ServiceNow Inc. 14.87% 17.20% 17.77% 14.93%
Synopsys Inc. 27.91% 22.47% 22.28% 17.29% 15.30%

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

1 NOPAT. See details »

2 Cash operating taxes. See details »

3 2022 Calculation
OPM = 100 × NOPBT ÷ Net revenues
= 100 × 3,537 ÷ 27,518 = 12.85%

4 Click competitor name to see calculations.

Profitability ratio Description The company
OPM The operating profit margin (OPM) is the ratio of pretax economic earnings, or NOPBT, to sales. PayPal Holdings Inc. OPM deteriorated from 2020 to 2021 and from 2021 to 2022.

Turnover of Capital (TO)

PayPal Holdings Inc., TO calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018
Selected Financial Data (US$ in millions)
Net revenues 27,518 25,371 21,454 17,772 15,451
Invested capital1 31,496 31,317 30,260 22,276 17,780
Efficiency Ratio
TO2 0.87 0.81 0.71 0.80 0.87
Benchmarks
TO, Competitors3
Accenture PLC 2.08 1.95 1.97 2.16
Adobe Inc. 0.86 0.80 0.70 0.67 0.61
Autodesk Inc. 0.70 0.72 0.76 0.61
Cadence Design Systems Inc. 1.00 0.98 0.99 1.03
CrowdStrike Holdings Inc. 0.64 0.48 1.14
International Business Machines Corp. 0.58 0.52 0.58 0.59
Intuit Inc. 0.52 0.79 0.89 1.50
Microsoft Corp. 1.04 1.20 1.35 1.35
Oracle Corp. 0.54 0.51 0.44 0.55
Palo Alto Networks Inc. 0.86 0.74 0.62 0.90
Salesforce Inc. 0.36 0.44 0.41 0.51
ServiceNow Inc. 1.24 1.16 1.23 1.36
Synopsys Inc. 0.71 0.63 0.58 0.58 0.59

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

1 Invested capital. See details »

2 2022 Calculation
TO = Net revenues ÷ Invested capital
= 27,518 ÷ 31,496 = 0.87

3 Click competitor name to see calculations.

Efficiency ratio Description The company
TO The turnover of capital (TO) is the ratio of sales to invested capital. Capital turnover is a function of the efficiency of working capital management and of net fixed assets. PayPal Holdings Inc. TO improved from 2020 to 2021 and from 2021 to 2022.

Effective Cash Tax Rate (CTR)

PayPal Holdings Inc., CTR calculation, comparison to benchmarks

Microsoft Excel
Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018
Selected Financial Data (US$ in millions)
Net operating profit after taxes (NOPAT)1 1,747 3,793 4,527 2,151 1,833
Add: Cash operating taxes2 1,790 454 728 796 475
Net operating profit before taxes (NOPBT) 3,537 4,247 5,256 2,947 2,308
Tax Rate
CTR3 50.61% 10.68% 13.86% 27.01% 20.58%
Benchmarks
CTR, Competitors4
Accenture PLC 25.55% 20.47% 19.34% 22.96%
Adobe Inc. 14.22% 10.28% 9.63% 7.06% 19.97%
Autodesk Inc. 9.38% 13.48% 6.38% 60.79%
Cadence Design Systems Inc. 25.88% 13.59% 9.34% 13.53%
CrowdStrike Holdings Inc. 18.96% 2.38% 1.95%
International Business Machines Corp. 139.75% 33.85% 37.95% 18.49%
Intuit Inc. 14.74% 20.15% 20.99% 18.37%
Microsoft Corp. 18.98% 13.05% 15.80% 22.65%
Oracle Corp. 26.20% 13.28% 23.42% 19.20%
Palo Alto Networks Inc. 3.82% 8.83% 7.62% 5.72%
Salesforce Inc. 8.31% 6.79% 19.81% 7.62%
ServiceNow Inc. 4.41% 5.03% 5.90% 2.51%
Synopsys Inc. 11.45% 18.39% 10.36% 16.50% 28.97%

Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).

1 NOPAT. See details »

2 Cash operating taxes. See details »

3 2022 Calculation
CTR = 100 × Cash operating taxes ÷ NOPBT
= 100 × 1,790 ÷ 3,537 = 50.61%

4 Click competitor name to see calculations.

Tax rate Description The company
CTR Effective cash tax rate on operating income. PayPal Holdings Inc. CTR decreased from 2020 to 2021 but then increased from 2021 to 2022 exceeding 2020 level.