Shares in PayPal rose around five per cent on its first morning of trading back on the Nasdaq following its separation from eBay, valuing the firm at around $50 billion, considerably more than its former parent.
PayPal's shares hit a high of $41.63 before settling back to $40.30, up from Friday's close of $38.35 when shares were trading on a "when issued" basis. Meanwhile, eBay shares held steady at $28.21, valuing the online marketplace at around $33 billion.
Founded by Peter Thiel, Elon Musk and others in the late 1990s, PayPal went public in 2002 before being snapped up by eBay in the same year for $1.5 billion. The split decision comes after activist investor Carl Icahn began agitated for a spin-off, arguing that that the auction site was hampering the growth and competitiveness of its payments subsidiary.
PayPal has 169 million active users and processed $235 billion in total payment volume and generated more than $8 billion in revenues last year. The firm claims that it is well-positioned to take advantage of the coming mobile money revolution in which it will battle the likes of Visa, MasterCard, Google, Apple, Stripe and a host of startups.
Dan Schulman, president and CEO, PayPal, says: "Mobile technology is transforming payments, making it easier, safer and more affordable for people to move and manage their money than ever before. As an independent company, we see a tremendous opportunity for PayPal to expand our role as a champion for consumers and partner to merchants, and to help shape the industry as money becomes digital at an increasingly rapid pace."