Here’s What You Should Buy Over PayPal Holdings, Inc. (NASDAQ:PYPL) According To Jim Cramer

Financial technology companies SoFi Technologies and PayPal Holdings have seen different stock performance in 2026. While SOFI has dropped 31% year-to-date, PYPL has risen by 5.9%. PayPal's stock has mostly benefited from takeover speculation, but host Jim Cramer remains skeptical about recommending the stock based on that factor alone.

Cramer criticized analysts for constantly recommending fin-tech firms, including SoFi, Klarna, and PayPal. He suggested not reiterating the stocks daily and letting them reach their downside before considering a recommendation. The discrepancy in valuation between SOFI and PayPal is evident, with SOFI's forward P/E ratio at 31.55 versus PayPal's 11.79.

SOFI's struggle stems from its transformation from a student loan provider to a digital bank. Its financial services and technology platforms are central to its value narrative, but they face challenges such as high deposit costs and a transition away from large clients. PayPal, on the other hand, is focusing on turnaround strategies like checkout performance improvements, AI modernization, cost savings, and Venmo growth.

Should PayPal achieve its $1.5 billion in gross run rate savings and generate earnings power, it could see tailwinds. However, mobile wallets pose a threat to PayPal's core business, and its top line growth depends on processing fees, which are not margin-advantageous. In Q1, 76 of 1,022 covered stocks by Insider Monkey held PayPal shares, compared to 47 for SOFI, suggesting a more cautious sentiment towards the former.