Shares of PayPal Holdings (NASDAQ: PYPL) were down 2.1% as of 11:31 a.m. ET on Tuesday after one analyst downgraded the stock on concerns of rising costs and lower profits. 

Susquehanna analyst James Friedman sees PayPal's shifting mix in payment volume toward the Braintree merchant solutions business, which generates a lower profit margin for PayPal, as a headwind for the company. This led Friedman to lower his rating on the stock from positive to neutral. 

PayPal's slowing growth coming out of the pandemic has contributed to a 69% decline in the stock price over the last year.  While management says it is investing in areas like merchant checkout to gain market share and position the business for long-term growth, Wall Street is more concerned about the hit to earnings per share.

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Source Fool.com