Comprehensive Stock Comparison
Compare Mastercard Incorporated (MA) vs PayPal Holdings, Inc. (PYPL) Stock
Analyze side-by-side fundamentals, valuation, growth, and profitability to decide which stock is the better buy.
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Quick Verdict
| Category | Winner | Why |
|---|---|---|
| Growth | MA | 16.4% revenue growth vs PYPL's 4.8% |
| Value | PYPL | Lower P/E (8.7x vs 26.4x), PEG 0.98 vs 1.26 |
| Quality / Margins | MA | 45.6% net margin vs PYPL's 15.7% |
| Stability / Safety | MA | Beta 0.78 vs PYPL's 1.30 |
| Dividends | MA | 0.6% yield, 14-year raise streak, vs PYPL's 0.3% |
| Momentum (1Y) | MA | -9.7% vs PYPL's -34.8% |
| Efficiency (ROA) | MA | 27.6% ROA vs PYPL's 6.5%, ROIC 56.5% vs 16.3% |
Who Each Stock Is For
Income & stability
Growth exposure
Long-term compounding (10Y)
Sleep-well-at-night portfolio
Valuation efficiency (growth/$)
Defensive / Recession hedge
Business Model
What each company does and how it makes money
Mastercard is a global payment technology company that operates a network connecting consumers, merchants, financial institutions, and governments. It generates revenue primarily from transaction processing fees—charging a small percentage of each payment volume—and from service fees for its data analytics, consulting, and security solutions. The company's moat lies in its massive two-sided network effect—the more merchants accept Mastercard, the more valuable it becomes to cardholders, and vice versa—creating a powerful ecosystem that's difficult to replicate.
PayPal operates a global digital payments platform that enables online money transfers and serves as an electronic alternative to traditional paper methods like checks and money orders. It generates revenue primarily from transaction fees — taking a percentage of each payment processed — with additional income from value-added services like PayPal Credit and merchant solutions. Its competitive advantage lies in its massive two-sided network of over 400 million active accounts and merchants, creating powerful network effects that make it difficult for competitors to displace.
Revenue Breakdown by Segment
How each company's revenue is distributed across its business units
Financial Metrics Comparison
Side-by-side fundamentals across 2 stocks. BestLagging
Financial Scorecard
MA leads in 5 of 6 categories (Financial Metrics, Profitability & Efficiency). PYPL leads in 1 (Valuation Metrics).
Financial Metrics (TTM)
PYPL and MA operate at a comparable scale, with $33.3B and $32.8B in trailing revenue. MA is the more profitable business, keeping 45.6% of every revenue dollar as net income compared to PYPL's 15.7%.
| Metric | MAMastercard Incorp… | PYPLPayPal Holdings, … |
|---|---|---|
| RevenueTrailing 12 months | $32.8B | $33.3B |
| EBITDAEarnings before interest/tax | $20.5B | $7.2B |
| Net IncomeAfter-tax profit | $15.0B | $5.2B |
| Free Cash FlowCash after capex | $17.1B | $5.6B |
| Gross MarginGross profit ÷ Revenue | +83.4% | +47.0% |
| Operating MarginEBIT ÷ Revenue | +59.2% | +19.7% |
| Net MarginNet income ÷ Revenue | +45.6% | +15.7% |
| FCF MarginFCF ÷ Revenue | +52.3% | +16.7% |
| Rev. Growth (YoY)Latest quarter vs prior year | — | — |
| EPS Growth (YoY)Latest quarter vs prior year | +24.2% | +37.8% |
Valuation Metrics
At 8.5x trailing earnings, PYPL trades at a 73% valuation discount to MA's 31.3x P/E. Adjusting for growth (PEG ratio), PYPL offers better value at 0.96x vs MA's 1.49x — a lower PEG means you pay less per unit of expected earnings growth.
| Metric | MAMastercard Incorp… | PYPLPayPal Holdings, … |
|---|---|---|
| Market CapShares × price | $457.8B | $42.5B |
| Enterprise ValueMkt cap + debt − cash | $465.7B | $44.5B |
| Trailing P/EPrice ÷ TTM EPS | 31.31x | 8.54x |
| Forward P/EPrice ÷ next-FY EPS est. | 26.43x | 8.68x |
| PEG RatioP/E ÷ EPS growth rate | 1.49x | 0.96x |
| EV / EBITDAEnterprise value multiple | 22.67x | 5.90x |
| Price / SalesMarket cap ÷ Revenue | 13.96x | 1.28x |
| Price / BookPrice ÷ Book value/share | 59.96x | 2.21x |
| Price / FCFMarket cap ÷ FCF | 26.68x | 7.64x |
Profitability & Efficiency
MA delivers a 193.0% return on equity — every $100 of shareholder capital generates $193 in annual profit, vs $26 for PYPL. PYPL carries lower financial leverage with a 0.49x debt-to-equity ratio, signaling a more conservative balance sheet compared to MA's 2.45x. On the Piotroski fundamental quality scale (0–9), MA scores 9/9 vs PYPL's 8/9, reflecting strong financial health.
| Metric | MAMastercard Incorp… | PYPLPayPal Holdings, … |
|---|---|---|
| ROE (TTM)Return on equity | +193.0% | +25.8% |
| ROA (TTM)Return on assets | +27.6% | +6.5% |
| ROICReturn on invested capital | +56.5% | +16.3% |
| ROCEReturn on capital employed | +64.4% | +19.6% |
| Piotroski ScoreFundamental quality 0–9 | 9 | 8 |
| Debt / EquityFinancial leverage | 2.45x | 0.49x |
| Net DebtTotal debt minus cash | $7.9B | $1.9B |
| Cash & Equiv.Liquid assets | $11.1B | $8.0B |
| Total DebtShort + long-term debt | $19.0B | $10.0B |
| Interest CoverageEBIT ÷ Interest expense | 26.39x | 12.25x |
Total Returns (with DRIP)
A $10,000 investment in MA five years ago would be worth $14,586 today (with dividends reinvested), compared to $1,694 for PYPL. Over the past 12 months, MA leads with a -9.7% total return vs PYPL's -34.8%. The 3-year compound annual growth rate (CAGR) favors MA at 13.9% vs PYPL's -14.3% — a key indicator of consistent wealth creation.
| Metric | MAMastercard Incorp… | PYPLPayPal Holdings, … |
|---|---|---|
| YTD ReturnYear-to-date | -8.0% | -20.5% |
| 1-Year ReturnPast 12 months | -9.7% | -34.8% |
| 3-Year ReturnCumulative with dividends | +47.9% | -37.0% |
| 5-Year ReturnCumulative with dividends | +45.9% | -83.1% |
| 10-Year ReturnCumulative with dividends | +515.7% | +21.5% |
| CAGR (3Y)Annualised 3-year return | +13.9% | -14.3% |
Risk & Volatility
MA is the less volatile stock with a 0.78 beta — it tends to amplify market swings less than PYPL's 1.30 beta. A beta below 1.0 means the stock typically moves less than the S&P 500. MA currently trades 85.9% from its 52-week high vs PYPL's 58.1% drawdown — a narrower gap to the peak suggests stronger recent price momentum.
| Metric | MAMastercard Incorp… | PYPLPayPal Holdings, … |
|---|---|---|
| Beta (5Y)Sensitivity to S&P 500 | 0.78x | 1.30x |
| 52-Week HighHighest price in past year | $601.77 | $79.50 |
| 52-Week LowLowest price in past year | $465.59 | $38.46 |
| % of 52W HighCurrent price vs 52-week peak | +85.9% | +58.1% |
| RSI (14)Momentum oscillator 0–100 | 42.8 | 46.2 |
| Avg Volume (50D)Average daily shares traded | 3.2M | 18.5M |
Analyst Outlook
Wall Street rates MA as "Buy" and PYPL as "Hold". Consensus price targets imply 29.0% upside for MA (target: $667) vs 14.8% for PYPL (target: $53). For income investors, MA offers the higher dividend yield at 0.59% vs PYPL's 0.29%.
| Metric | MAMastercard Incorp… | PYPLPayPal Holdings, … |
|---|---|---|
| Analyst RatingConsensus buy/hold/sell | Buy | Hold |
| Price TargetConsensus 12-month target | $667.00 | $53.05 |
| # AnalystsCovering analysts | 63 | 69 |
| Dividend YieldAnnual dividend ÷ price | +0.6% | +0.3% |
| Dividend StreakConsecutive years of raises | 14 | 1 |
| Dividend / ShareAnnual DPS | $3.07 | $0.13 |
| Buyback YieldShare repurchases ÷ mkt cap | +2.6% | +14.2% |
Historical Charts
Charts are rendered on first load. Hover for details.
Chart 1Total Return — 5 Years (Rebased to 100)
| Stock | Mar 20 | Feb 26 | Change |
|---|---|---|---|
| Mastercard Incorpor… (MA) | 100 | 181.06 | +81.1% |
| PayPal Holdings, In… (PYPL) | 100 | 46.37 | -53.6% |
Mastercard Incorpor… (MA) returned +46% over 5 years vs PayPal Holdings, In… (PYPL)'s -83%. A $10,000 investment in MA 5 years ago would be worth $14,586 today (including dividends reinvested).
Chart 2Revenue Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| Mastercard Incorpor… (MA) | $10.8B | $32.8B | +204.3% |
| PayPal Holdings, In… (PYPL) | $10.8B | $33.3B | +207.5% |
Mastercard Incorporated's revenue grew from $10.8B (2016) to $32.8B (2025) — a 13.2% CAGR. PayPal Holdings, Inc.'s revenue grew from $10.8B (2016) to $33.3B (2025) — a 13.3% CAGR.
Chart 3Net Margin Trend — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| Mastercard Incorpor… (MA) | 37.7% | 45.6% | +21.2% |
| PayPal Holdings, In… (PYPL) | 12.9% | 15.7% | +21.5% |
Mastercard Incorporated's net margin went from 38% (2016) to 46% (2025). PayPal Holdings, Inc.'s net margin went from 13% (2016) to 16% (2025).
Chart 4P/E Ratio History — 9 Years
| Stock | 2017 | 2025 | Change |
|---|---|---|---|
| Mastercard Incorpor… (MA) | 41.5 | 34.6 | -16.6% |
| PayPal Holdings, In… (PYPL) | 50.1 | 10.8 | -78.4% |
Mastercard Incorporated has traded in a 34x–56x P/E range over 9 years; current trailing P/E is ~31x. PayPal Holdings, Inc. has traded in a 11x–66x P/E range over 9 years; current trailing P/E is ~9x.
Chart 5EPS Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| Mastercard Incorpor… (MA) | 3.69 | 16.52 | +347.7% |
| PayPal Holdings, In… (PYPL) | 1.15 | 5.41 | +370.4% |
Mastercard Incorporated's EPS grew from $3.69 (2016) to $16.52 (2025) — a 18% CAGR. PayPal Holdings, Inc.'s EPS grew from $1.15 (2016) to $5.41 (2025) — a 19% CAGR.
Chart 6Free Cash Flow — 5 Years
Mastercard Incorporated generated $17B FCF in 2025 (+98% vs 2021). PayPal Holdings, Inc. generated $6B FCF in 2025 (+14% vs 2021).
MA vs PYPL: Frequently Asked Questions
9 questions · data-driven answers · updated daily
01Is MA or PYPL a better buy right now?
PayPal Holdings, Inc. (PYPL) offers the better valuation at 8.5x trailing P/E (8.7x forward), making it the more compelling value choice. Analysts rate Mastercard Incorporated (MA) a "Buy" — based on 63 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.
02Which has the better valuation — MA or PYPL?
On trailing P/E, PayPal Holdings, Inc. (PYPL) is the cheapest at 8.5x versus Mastercard Incorporated at 31.3x. On forward P/E, PayPal Holdings, Inc. is actually cheaper at 8.7x. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: PayPal Holdings, Inc. wins at 0.98x versus Mastercard Incorporated's 1.26x — a PEG below 1.0 traditionally signals the market is underpricing earnings growth.
03Which is the better long-term investment — MA or PYPL?
Over the past 5 years, Mastercard Incorporated (MA) delivered a total return of +45.9%, compared to -83.1% for PayPal Holdings, Inc. (PYPL). A $10,000 investment in MA five years ago would be worth approximately $15K today (assuming dividends reinvested). Over 10 years, the gap is even starker: MA returned +515.7% versus PYPL's +21.5%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.
04Which is safer — MA or PYPL?
By beta (market sensitivity over 5 years), Mastercard Incorporated (MA) is the lower-risk stock at 0.78β versus PayPal Holdings, Inc.'s 1.30β — meaning PYPL is approximately 68% more volatile than MA relative to the S&P 500. On balance sheet safety, PayPal Holdings, Inc. (PYPL) carries a lower debt/equity ratio of 49% versus 2% for Mastercard Incorporated — giving it more financial flexibility in a downturn.
05Which has better profit margins — MA or PYPL?
Mastercard Incorporated (MA) is the more profitable company, earning 45.6% net margin versus 15.7% for PayPal Holdings, Inc. — meaning it keeps 45.6% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: MA leads at 59.2% versus 19.7% for PYPL. At the gross margin level — before operating expenses — MA leads at 83.4%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.
06Is MA or PYPL more undervalued right now?
The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential. By this metric, PayPal Holdings, Inc. (PYPL) is the more undervalued stock at a PEG of 0.98x versus Mastercard Incorporated's 1.26x. A PEG below 1.0 is traditionally considered the threshold for growth-adjusted undervaluation. On forward earnings alone, PayPal Holdings, Inc. (PYPL) trades at 8.7x forward P/E versus 26.4x for Mastercard Incorporated — 17.7x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for MA: 29.0% to $667.00.
07Which pays a better dividend — MA or PYPL?
All stocks in this comparison pay dividends. Mastercard Incorporated (MA) offers the highest yield at 0.6%, versus 0.3% for PayPal Holdings, Inc. (PYPL).
08Is MA or PYPL better for a retirement portfolio?
For long-horizon retirement investors, Mastercard Incorporated (MA) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0.78), 0.6% yield, +515.7% 10Y return). Both have compounded well over 10 years (MA: +515.7%, PYPL: +21.5%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.
09What are the main differences between MA and PYPL?
Both stocks operate in the Financial Services sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both. In terms of investment character: MA is a large-cap quality compounder stock; PYPL is a mid-cap deep-value stock. MA pays a dividend while PYPL does not, making them suitable for different income and tax situations. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.
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