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PayPal's acquisition spree puts it in an 'unrivaled' position

Brian Sozzi

PayPal (PYPL) is still willing and able to open its digital wallet up wide to buy more companies in the online payments space.

“By no means are we done yet on acquisitions — we have a pretty aggressive appetite in terms of acquiring other companies,” PayPal Chief Financial Officer John Rainey told Yahoo Finance. Rainey said PayPal continues to expect to spend $1 billion to $3 billion a year buying other companies.

Rainey wouldn’t disclose potential targets, but hinted that overseas acquisitions, in the mold of recently acquired iZettle, are a key focus of the company. iZettle primarily operates in Europe.

India may be where the company strikes next followed by China, a source with knowledge of PayPal’s business told Yahoo Finance .

PayPal has certainly rounded into form as, Rainey called it, the “natural consolidator” in digital payments. Helping PayPal’s cause: more than $8 billion in cash and no debt on its books.

In June, the company paid $120 million for fraud prevention and risk management services firm Simility. Together with the recent purchases of payments platforms Hyperwallet and iZettle, PayPal has already neared the $3 billion upper end of the annual acquisition spending range that Rainey laid out.

And the year isn’t even over yet.

Arguably PayPal’s most legendary — and lucrative deal — under CEO Dan Schulman was the $800 million buy of BrainTree in 2013. The acquisition gave PayPal Venmo, an upstart payments platform at the time. Today, Venmo has become the de facto payments platform of choice among teens and millennials.

“BrainTree was one of the best deals of all-time in the industry,” said Mark Palmer, BTIG financials analyst.

PayPal’s string of acquisitions since has put the company in an unrivaled spot, thinks Palmer.

“There really isn’t another company out there in the space with their breadth of assets — the company is unrivaled,” Palmer told Yahoo Finance. “PayPal is focused on becoming increasingly part of their users’ financial life.”

Brian Sozzi is an editor-at-large at Yahoo Finance. Follow him on Twitter @BrianSozzi

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