PayPal Holdings on Thursday plans to host an online presentation to tout new artificial intelligence-driven innovations the company plans to bring to market in 2024. The move comes ahead of the fourth quarter earnings report for PYPL stock, which is slated for Feb. 7.
New Chief Executive Alex Chriss announced the innovation event during an interview on CNBC last week. Chriss and PayPal's new chief financial officer, Jamie Miller, are expected to issue conservative 2024 guidance on Feb. 7.
Wall Street analysts continue to weigh in on the innovation event.
PayPal Stock: Leveraging Customer Data
Morgan Stanley analyst James Faucette said in a report: "We expect Chriss to discuss how PayPal plans to lever AI to enhance consumer and merchant personalization in commerce. We generally would view such tech application to reducing checkout friction as positive but would be quite skeptical of any efforts related to demand generation. We view Friday's (Jan. 19) 6% move up post Chriss's TV appearance ... as indicative of heavily shorted stock."
Deutsche Bank analyst Bryan Keane said in a report: "At PayPal's upcoming Innovation Day, we expect management will focus on how to leverage its rich data to drive profitable growth." He added: "On the merchant side, we anticipate updates on how PYPL will use its insights on consumer purchasing patterns to improve merchant conversion rates. Also, how to utilize AI to help businesses drive personalized offers to attract customers."
Meanwhile, PayPal stock has gained 6% in 2024 after falling 14% last year.
San Jose, Calif.-based PayPal has evolved from an online checkout site to a mobile shopping and person-to-person payments site. Under Chriss, PayPal aims to expand "PayPal Complete Payments" services in the small- and medium-size business market. Chriss, a former Intuit executive, took over as CEO in September.
PYPL Stock: AI Data Push Coming?
Further, RBC Capital analyst Daniel Perlin speculated on the innovation event in a report.
"Given the artificial intelligence-driven commentary during a CNBC interview, it's clear to us that they will showcase the key data assets the company has, starting with its 430 million active accounts, of which 35 million are merchant accounts and specifically demographically attractive users in Venmo," Perlin said.
He added: "As part of these data assets, the CEO mentioned using AI to improve authorization rates for its merchants, while also calling out that advertising costs for SMBs have increased in recent years. At a high level, we believe they will bring together a solution that pulls together its two-sided ecosystem in a manner that looks and feels more like an e-commerce platform vs. just a separate and siloed set of data assets (consumers on one side and merchants on the other)."
In addition, PYPL stock holds a Relative Strength Rating of only 43 out of a best-possible 99.
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