PayPal (PYPL -0.03%) stock zoomed higher this week, according to data from S&P Global Market Intelligence. After a rough few years, the financial technology (fintech) giant has stabilized its active users and continues to grow payment volume, revenue, and profits. It reported second-quarter earnings that beat Wall Street expectations, and shares are up 12% since last Friday as of the close on Thursday, Aug. 1.

Here's why PayPal stock shot up this week.

Payment volume growth, recovering margin profile

In the second quarter, PayPal's top line hummed along just swimmingly. Payment volume grew 11% year over year to $417 billion, which led to revenue growing 8% to $7.89 billion. There has been a narrative about market share losses and competition that has kept PayPal's stock in the gutter, but it has shown time and time again that it can still grow sales. Over the last five years, the company's revenue is up 82%.

More importantly, PayPal continues to recover its margin profile from the COVID-19 pandemic. Operating income grew 17% year over year to $1.3 billion in the quarter for an operating margin of 16.5%. PayPal is now operating more efficiently, which Wall Street is applauding. Monthly active accounts grew 3% year over year to 222 million, and the company is still repurchasing a ton of stock with the cash piling up on its balance sheet. All around, it was a solid quarter for PayPal.

The stock is still down 80%

Even though PayPal popped 100% this week, the stock is off 80% from highs set back in 2021. Back then, with an old management team, PayPal claimed it had plenty of room to grow its active users and traded at a price-to-earnings ratio (P/E) over 50. That is expensive, even in a bull market like 2021.

Now, with the stock in the gutter, PayPal trades at a dirt-cheap P/E of just over 15. Management is guiding for more share repurchases to take advantage of this cheap stock. Margins continue to grow, and revenue is showing no signs of slowing down. Even after this stock pop, PayPal looks relatively cheap and could be a bargain. If you are a believer in the long-term growth of PayPal and digital payments, now could be a fantastic time to scoop up some shares of the fintech giant.