PayPal Is Yesterday's News. Is This Fintech the Better Buy?
Written by Justin Pope for The Motley Fool -> PayPal's user base is stagnant, while fresher competitors continue to grow. SoFi has swelled to more than 14.7 million users with its super app. Despite some valuation and balance sheet risks, SoFi puts up a strong argument for you
PayPal's user base is stagnant, while fresher competitors continue to grow.
SoFi has swelled to more than 14.7 million users with its super app.
Despite some valuation and balance sheet risks, SoFi puts up a strong argument for your capital.
PayPal Holdings was one of the first companies in what is now known as the financial technology, or fintech, industry. It had a great run, but more recently PayPal stock has been a disaster, falling 32% during the past three years. It has struggled with fierce competition, and leadership turnover hasn't helped it right the ship.
On the other hand, SoFi Technologies (NASDAQ: SOFI) is among a new group of fintech companies that are changing how people interact with money. Putting the two companies next to each other definitely paints PayPal as yesterday's news versus the rising star.
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But is SoFi Technologies stock , up 75% during the past three years, actually the better buy? Here's what you need to know.
PayPal remains a prominent player in payments, with about 439 million active accounts. The problem is that competition has crept up on PayPal. Apple and Alphabet have infiltrated the industry with their digital wallets. Meanwhile, PayPal's margins have dropped as its white-label payments business outgrew its more profitable branded checkout.
