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Benzinga
Benzinga
Business
Adam Eckert

Jim Cramer Says PayPal Has Lost All Credibility Following Q4 Results: 'It's A Disgrace'

PayPal Holdings Inc (NASDAQ:PYPL) is plummeting Wednesday after the company reported mixed financial results and issued weak guidance, but Jim Cramer thinks there is a larger underlying issue chasing buyers away from the stock. 

"The reason why it's sinking the way that it is, is because people don't know what the multiple should be because the credibility of the company is so shot," Cramer said Wednesday on CNBC's "Squawk On The Street."

See Also: Why PayPal Shares Are Plunging Today

Cramer noted that he interviewed PayPal CEO Dan Schulman in November and thought that the company's outlook was promising. He was even adding to his PayPal position for the charitable trust around that time, citing "conviction in the fundamentals."

Cramer noted that PayPal now plans to adjust its customer acquisition and engagement strategy, which will hinder its ability to meet its longer-term customer account goals.

"Did I see this coming? Absolutely not," Cramer said, adding that he was "100% wrong" about PayPal. 

He thinks PayPal sellers are willing to sell at any level because the company has lost all credibility. Money managers are likely saying "get that damn thing off my sheets, I never want to hear about PayPal again," Cramer said. "Their credibility is done, the stock is in half, they didn't tell us how slow things are — it's a disgrace."

PYPL Price Action: PayPal's 52-week high is $310.16. It's making new 52-week lows Wednesday.

The stock was down 24.91% at $132.02 at time of publication.

Photo: courtesy of PayPal.

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