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PayPal (PYPL) Slides As Schwab Clients Rotate Out

JACK KELLOGG•UPDATED AUG. 28, 2026, 7:48 AM ET
Reviewed by Tim Sykesand Fact-checked by Ellis Hobbs

PayPal Holdings Inc. stocks have been trading down by -16.32 percent amid heightened concerns over weakening digital payment growth.

Key Takeaways

  • Schwab clients were net sellers of PayPal (PYPL) in July, signaling a clear shift away from the name.
  • The selling in PYPL points to waning enthusiasm and a tactical move to free up cash.
  • PayPal shares appear to be used as a source of funds while traders selectively take risk in other pockets of the market.
  • PYPL’s solid margins and cash flow contrast with the recent weak sentiment, creating a classic tug‑of‑war setup for active trading.

Candlestick Chart

Live Update At 07:47:56 EDT: On Friday, August 28, 2026 PayPal Holdings Inc. stock [NASDAQ: PYPL] is trending down by -16.32%! Discover the key drivers behind this movement as well as our expert analysis in the detailed breakdown below.

Quick Financial Overview

PYPL is not trading like a broken company. On the numbers, PayPal still looks like a cash machine. The latest quarter shows revenue around $33.2B annualized, with a profit margin near 14% and a fat gross margin close to 60%. That tells traders PYPL’s core business is still throwing off real money.

Earnings power is solid. Diluted EPS sits near $1.25 for the quarter, and PayPal generated about $1.78B in free cash flow. With a price‑to‑earnings ratio around 11.7 and price‑to‑sales near 1.6, PYPL trades like a value name, not a high‑flying tech story. That discount versus its past five‑year P/E high above 50 stands out.

More Breaking News

The balance sheet is workable. Total debt is manageable versus equity, and interest coverage above 14 times suggests no immediate stress. On the chart, PYPL has been grinding between roughly $57 and $62 over recent days, with closes clustering in the low $60s. That tight range, on top of strong fundamentals but weak sentiment, is exactly the kind of coil active traders watch for the next momentum break.

Why Traders Are Watching PYPL Flows

The news that Schwab clients were net sellers of PayPal in July matters more than it sounds. When a big brokerage’s client base uses PYPL as a “source of funds,” it tells you something about positioning. Traders are not dumping distressed junk. They are trimming liquid, high‑quality names like PayPal Holdings Inc. to chase higher‑beta setups elsewhere.

That steady selling pressure can cap any short‑term bounce. Even if PYPL’s fundamentals look fine, those flows chip away at rallies as supply keeps hitting the tape. Waning enthusiasm is the key phrase here. It means fewer dip‑buyers are stepping in with conviction, at least in that Schwab crowd, while others move capital into different trades.

Overlay that with the recent price action. Over the last several sessions, PYPL has traded in a relatively narrow $59–$62 band, struggling to hold pushes toward the mid‑$62s. This kind of sideways action after distribution headlines often signals a “wait and see” mode from larger accounts. For day traders, PayPal’s intraday five‑minute chart shows clean intraday swings from the low $50s premarket up through the mid‑$53s and back. That’s real range for scalpers.

The bigger takeaway: PYPL sits at an interesting crossroads. Strong cash flow and a low multiple on one side. Selling pressure from Schwab clients and rotating capital on the other. When that kind of tug‑of‑war resolves, the next trend leg is often sharp, and prepared traders will be ready.

Conclusion

For active traders, PYPL right now is less about the story and more about the order flow. PayPal Holdings Inc. is generating $1.98B in quarterly operating cash flow, sitting on over $21.9B in cash, and still posting double‑digit returns on equity. Yet Schwab accounts are net sellers, clearly using the stock to raise cash while they reach for other opportunities. That disconnect between solid fundamentals and cautious behavior is where trading edges often live.

In the short term, continued distribution from broker clients can keep a lid on PYPL’s rallies. If the stock keeps stalling around $62 and failing to attract new buyers, range trading and fade setups remain on the table. On the flip side, if selling pressure dries up and PayPal pushes cleanly above recent highs with volume, that signals sentiment turning and possible momentum back toward prior resistance levels.

Traders in the Tim Sykes community focus on exactly these kinds of turning points. As Tim loves to say, “Patterns repeat because human nature doesn’t change — your job is to recognize the pattern, manage your risk, and never marry a stock.” As millionaire penny stock trader and teacher Tim Sykes, says, “Cut losses quickly, let profits ride, and don’t overtrade.”. PYPL is offering a clear pattern of distribution versus value right now. Study the chart, track the flows, and remember this is educational research, not advice — your trading plan and risk management come first.

This is stock news, not investment advice. Timothy Sykes News delivers real-time stock market news focused on key catalysts driving short-term price movements. Our content is tailored for active traders and investors seeking to capitalize on rapid price fluctuations, particularly in volatile sectors like penny stocks. Readers come to us for detailed coverage on earnings reports, mergers, FDA approvals, new contracts, and unusual trading volumes that can trigger significant short-term price action. Some users utilize our news to explain sudden stock movements, while others rely on it for diligent research into potential investment opportunities.

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* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

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Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”