PayPal surges 13% after activist pact, $15B buyback, analyst upgrade
hapabapa

PayPal Holdings (NASDAQ:PYPL) stock is jumping 13% in Wednesday premarket trading after the payment technology company announced a $15B shares repurchase program and agreed to work with activist shareholder Elliott Investment Management on a review of capital return alternatives. 
FY2022 repurchases are expected to reach ~$4B, the company said in its Q2 earnings statement.
The company is also entering an information sharing agreement with Elliott "to continue collaboration across a range of value-creation opportunities."
SMBC Nikko upgraded PayPal (PYPL) to Neutral from Underperform after the Q2 earnings call showed management is committed to delivering margin expansion, is refocusing around core competencies, the firm said in a note to clients.
"We expect operating margin expansion beginning in the fourth quarter of this year and continuing in 2023," PayPal (PYPL) CEO Dan Schulman said on the Q2 earnings call. 
The company is targeting at least 50 basis points of operating margin expansion next year, interim CFO Gabrielle Rabinovitch said during the call.
"While PYPL may be one of the most exposed names in our coverage to consumer discretionary end markets, PYPL's margin upside potential may be too significant to ignore," SMBC Nikko's note said. 
SA contributor The Asian Investor says with PYPL, the 'rebound is finally here.'
Previously (Aug. 2), PayPal (PYPL) stock soars after Q2 beat and year guidance boost.