PayPal (PYPL) stock up after nixing deal with pal Pinterest, PINS down 15% to 52-week low

The engagement was short. Reports only surfaced last Wednesday that PayPal (PYPL) was in talks to buy Pinterest (PINS) for as much as $70 a share or $45 billion, with the vast majority coming in the form of stock.

Then well after the entire market heard the gossip and PYPL shares had collapsed by more than 11% by the close of Friday, Paypal disclosed that there would be no deal. At the time of writing, PYPL stock is up 6.3% in the premarket to $255.50. Shares of scorned lover Pinterest, however, are down a steep 15% to $48.99.

Paypal, Pinterest Stock News: The one that got away

The payments giant has been on something of a buying spree in recent years. In 2019, it scooped up e-coupon browser extension Honey Science. Additionally, this year it purchased Happy Returns, also in the e-commerce space, and the Japanese buy-now-pay-later company Paidy. The latter cost $2.7 billion.

Still, nothing has approached the size of Pinterest at $45 billion. The latter has seen its share price falter this year after a high-powered expansion in 2020. One of Pinterest’s co-founders said a few weeks ago that he would be leaving the firm, an extra setback for investors looking for signs of hope after Q2 earnings reported a drop of 24 million daily active users.

Paypal, Pinterest Stock Charts: Moving in separate directions

PYPL stock price has already risen to resistance around $255 in Monday’s premarket, whereas one would expect it faced some headwinds. The first target for bulls expecting this stock to turn around and make gains in the week ahead back toward $271, its price before the PINS acquisition news is $258.87. This is the 9-day moving average as of Friday. Without a quick break here, and a subsequent break of the nearby 20-day moving average of $260.35, the stock will likely remain stagnant and could even give back some ground.

Resistance further up is just above $265, which was a prior source of support until September but is now likely to act as a barrier. Beyond that, the high from last week at $273.50 will be another source of resistance, as some traders will likely take profit here. The fourth target is $280, where PYPL stock experienced several sessions of resistance here in August.

PYPL 1-day chart

With the news that the $70 acquisition is no longer on the table, PINS investors are only looking downward. In the premarket on Monday, PINS stock fell below its range low since Q2 earnings of $49.01. It has not been here since exactly one year ago, when $49 acted as a support region before a hefty rally that took the stock well into the $60s.

Since there is a clear price gap from that late October 2020 climb, it is almost certain that PINS shares will close that gap to $46.35. The goal at present for PINS bulls will be simply to get back above $54.30 – the 50-day moving average.

PINS 1-day chart