Split from eBay, PayPal climbs in trading

PayPal Holdings Inc. shares rose as much as 11 percent Monday in their market debut after separating from eBay Inc.

The shares rose $2.08, or 5.4 percent, to close Monday at $40.47 in New York after climbing as high as $42.55. PayPal is trading on the Nasdaq stock market as PYPL, its original ticker symbol before being acquired by eBay in 2002. EBay shares rose 67 cents, or 2.4 percent, to close at $28.57.

PayPal Chief Executive Officer Dan Schulman said that helping retailers develop smartphone apps that let consumers place orders and make payments in advance — as PayPal has done with Subway and Burger King — will be important to maintaining the company’s growth, which has attracted investors.

Global transactions total $25 trillion a year, about 10 percent of which are made online, making stores a key growth area, he said.

“It’s a much bigger marketplace,” Schulman said in an interview.

PayPal opened trading with a market value almost 1.4 times that of eBay Inc. as investors bet on bigger returns from the digital-payment business than from its former parent company struggling with slow growth.

PayPal started trading Monday with a market capitalization of about $46.6 billion, data compiled by Bloomberg show.

After the spinoff, eBay’s shrinks to roughly $34 billion. Investors are viewing PayPal as a new growth option while eBay’s expansion decelerates amid increasing competition in e-commerce.