AMZN - PayPal Vs. Adyen: Consumer Wallet Vs. Enterprise Stack--Which Should You Own?

2025-04-25 12:57:15 ET

Summary

• PayPal is undergoing a major transformation to become a comprehensive commerce infrastructure, leveraging AI, crypto, and streamlined transaction layers to boost growth and engagement.
• Adyen focuses on deepening relevance within existing relationships, showcasing strong operational leverage, and maintaining high margins through intelligent payment routing and enterprise-grade infrastructure.
• PayPal's valuation reflects execution risks and competitive pressures, while Adyen's premium valuation underscores its consistent growth, operational clarity, and scalability.

Thesis

PayPal Holdings, Inc. (NASDAQ: PYPL ) and Adyen N.V. (OTC: OTCPK:ADYEY ) may both play central roles in the world of digital payment, but they go about it in very different ways, and investors would do well to keep that in mind. PayPal is in the middle of a major overhaul, trying to move beyond being just a middleman for transactions. The company is aiming to become a smarter, broader network that connects consumers and merchants across checkout, rewards, crypto, and AI-driven services. Adyen, meanwhile, is playing a much quieter but highly effective game, running the back end for some of the world’s biggest companies with a payments system that bets on precision, scale, and reliability instead of flash.

When I covered PayPal last fall , I rated it a Buy, mostly because the market seemed to be missing how strong its innovation pipeline was, things like rising Venmo engagement, AI-driven advertising, and its expansion into crypto infrastructure. Even with the CFPB sniffing around and pressure from Stripe and Square heating up, PayPal was still growing free cash flow, boosting EPS, and trading at one of the cheapest multiples it’s seen in years....

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