Chapter 1: What is the main topic discussed in this episode?
Public.com presents The Rundown, your daily market update in under 10 minutes.
My name is Zaid Admani, and today is Wednesday, February 25th. In today's episode, we'll tell you why PayPal might get acquired soon. Then we'll break down earnings from Circle, Kava, and Lucid. Then stick around to the end of the show to find out why Apple is bringing manufacturing to my hometown of Houston, Texas. We got a great show for you today. Let's go.
Markets bounced back on Tuesday with the S&P 500 rising 0.8% and the NASDAQ gained 1%, pretty much making up for all the losses from Monday. Yesterday was a broad-based rally. Over 350 stocks in the S&P were in the green and 9 out of the 11 sectors were also up.
So the vibes were good yesterday, and one of the best performing stocks was AMD, which jumped 9% after announcing a massive $100 billion chip deal with Meta. I broke down that deal on yesterday's show, so go check that out if you missed it.
Chapter 2: What recent developments have affected PayPal's stock value?
Now, software stocks also moved higher yesterday, this time thanks to Anthropic. Anthropic held an event yesterday, and they said they plan to partner with existing software companies and, you know, not destroy them like everyone thought was gonna happen. So it was nice to see an anthropic related headline help the stock market and not cause a crash.
And hopefully this will calm some of the AI panic that we've seen over the last few weeks. Now, speaking of AI, today's a big day because Nvidia reports earnings after the bell. You know, with the AI trade wobbling these days, investors are going to want to see blowout earning. So expectations are going to be high.
You know, fun fact about Nvidia, their stock has only gone up 7% in the last six months. So not a lot of movement there. We'll see if Nvidia stock and the overall market gets a boost after the numbers drop. I'm really curious to see what CEO Jensen Huang has to say on the earnings call. We'll recap all that stuff on tomorrow's show. So make sure you guys tune in for that.
Let's run through some headlines. starting with PayPal. PayPal is going through a rough stretch right now. The stock has lost nearly half its value over the last year. They just fired their CEO at their poor Q4 earnings. Payment volumes are slowing down from competition from Apple Pay, Google Pay, and ShopPay. So the vibes are not good for one of the most iconic internet companies in history.
But because of the slide in the company's stock, they've now become a potential takeover target. According to Bloomberg, PayPal has been taking meetings with banks after receiving interest from multiple potential buyers. At least one buyer is looking at buying the whole company, while others are only interested in certain PayPal assets.
One of the companies interested in buying PayPal seems to be Stripe. Stripe is an online payment processing company. They're essentially like a key financial infrastructure for the internet, and they're one of the most valuable private companies in the world.
In fact, just recently, the company was valued at $159 billion after an employee tender offer, which is when a company gives existing shareholders a chance to cash out some or all of their stock to the company or a third-party investor. Stripe and PayPal are still in the early stages, but adding PayPal could be a huge get for Stripe.
Despite all the issues that I just outlined, PayPal is still one of the most recognizable payment networks in the world. They process almost $2 trillion in annual transaction volume. They also own Venmo, which is the most popular peer-to-peer payment app in the US. So yeah, big picture, PayPal might be getting acquired soon. Would be interesting to see if Stripe ends up buying them.
I kind of think that Apple should consider making a move here too. Let's stick with the fintech theme and talk about Circle. Circle is the company behind the stablecoin USDC. It's the second largest stablecoin in the world, and they just delivered a monster earnings report beating on both revenue and profit estimates.
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