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Fly News Breaks for November 21, 2019
PYPL
Nov 21, 2019 | 08:45 EDT
JPMorgan analyst Tien-tsin Huang says PayPal made a "bold chess move" he was not expecting by announcing plans to acquire Honey for $4B, its largest acquisition to date. The analyst had expected PayPal to bolster consumer engagement by adding financial services tools, "but Honey gives PayPal smart shopping tools instead," he notes. The valuation paid is steep, says Huang. However, with potential for real revenue synergies from flywheel effects, and earnings accretion by year two, the analyst likes the merits of the deal recognizing. He keeps an Overweight rating on PayPal shares.