Unveiling PayPal (PYPL) as the Stock Titan of the Day

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By Ronald Tech

Venmo Drives PayPal Momentum

PayPal’s recent success is not just luck; it is strategically entangled with the rise of Venmo. This digital wallet, under PayPal’s umbrella, has magnetized a young American audience, making it not just a payment service but a social hub where users can peek at others’ transactions. In Q1 of 2024 alone, Venmo experienced an impressive 8% surge in total payment volume from the prior year. The platform managed nearly $250 billion in TPV during 2022, clinching a 6% year-over-year uptick.

Major Alliances Boost PayPal’s Earnings

PayPal’s management has been on a partnership spree, sealing deals with heavyweights like Visa and Mastercard. These collaborations have been instrumental in expanding PayPal’s global footprint, onboarding millions of merchants and consumers worldwide. Venture into the realms of Google Pay, YouTube, and Alibaba has serendipitously opened doors into lucrative Asian markets. These alliances have not only driven revenue growth but have secured PayPal’s position as a financial giant.

PayPal: A Diamond in the Rough

While many pandemic favorites have faltered, PayPal stands tall. Despite its stock price tumbling from the peaks of ~$300 to below $100, PayPal boasts a robust business model. Surprisingly, PYPL earnings have surged higher than when the stock was at its zenith. With projections pointing to a continued upward trajectory into 2027, PayPal emerges as a formidable contender in the financial landscape.

Technical Breakthrough for PYPL

Recent market dynamics have been kind to PayPal. The stock recently broke out of a prolonged consolidation phase, exhibiting two positive signals. The Golden Cross, with the fast-moving average surpassing the long-term one, heralds a bullish outlook. Additionally, the transformation of old price resistances into support indicates a robust foundation for PayPal’s stock, even amidst market volatility.

See also  Wealth Tax: Debating the Top Tax Bracket Debate Over the Wealth Tax

Are the wealthy getting away with not paying their fair share of taxes, or are they carrying an unfair burden? The debate over the top tax bracket rages on as concerns about income inequality and the concentration of wealth at the top of the economic ladder continue to make headlines. Senators Bernie Sanders and Elizabeth Warren have both proposed a wealth tax on the ultra-rich, while even multi-billionaire Warren Buffett has vocally expressed support for the idea, suggesting that it is fair for wealthy Americans to be taxed at a higher rate.

Currently, the top federal income tax rate stands at 37%, applicable to incomes of $539,000 and higher for single taxpayers and $647,850 and higher for couples filing jointly. However, historical data reveals that the top marginal tax rate has been significantly higher in previous eras. In 1944 and 1945, it peaked at a staggering 94%, and in the late 1980s, it hit a low of 28% under former President Ronald Reagan.

Historical Context and Present Day

The taxation of the wealthy has fluctuated significantly throughout U.S. history, demonstrating both higher and lower levels of taxation than the current status. This historical perspective adds complexity to the ongoing debate regarding whether the rich are paying their fair share of taxes. Despite the disputes, recent data from the IRS sheds light on the current tax scenario.

Top 1% Tax Contributions

In 2020, the top 1% of taxpayers—those earning $561,351 or more—contributed a significant 42.3% of the total tax revenue collected. This translates to the top 1% paying more income taxes than the bottom 90% combined. Astonishingly, the top 1% paid a staggering $723 billion in income taxes, while the bottom 90% collectively contributed $450 billion.

State-Level Analysis

Examining the tax burden on the wealthiest individuals at the state level yields interesting findings:

Alabama Minimum income to be considered 1%: $404,560 Average income of the 1%: $1,107,769 Average income tax paid by the 1%: $263,845 Average tax rate of the 1%: 23.82% Alaska Minimum income to be considered 1%: $466,905 Average income of the 1%: $999,772 Average income tax paid by the 1%: $253,754 Average tax rate of the 1%: 25.38% Arizona Minimum income to be considered 1%: $485,146 Average income of the 1%: $1,464,848 Average income tax paid by the 1%: $369,426 Average tax rate of the 1%: 25.22% Arkansas Minimum income to be considered 1%: $387,666 Average income of the 1%: $1,483,925 Average income tax paid by the 1%: $313,266 Average tax rate of the 1%: 21.11% California Minimum income to be considered 1%: $726,188 Average income of the 1%: $2,430,790 Average income tax paid by the 1%: $655,180 Average tax rate of the 1%: 26.95% Colorado Minimum income to be considered 1%: $609,919 Average income of the 1%: $1,799,148 Average income tax paid by the 1%: $465,284 Average tax rate of the 1%: 25.86% Analysis of Minimum Income of the Wealthiest 1% and Average Tax Rates by State Analysis of Minimum Income of the Wealthiest 1% and Average Tax Rates by State

In a Nutshell

Venmo’s meteoric rise, strategic partnerships, and an undervalued stock present a compelling case for PayPal’s growth prospects over the coming months. As the stock market weathers changing tides, PayPal seems poised to be the beacon of stability and growth for investors.