Is EBay's PayPal The Purest Play?

In a summary published Friday morning, Susquehanna's James Friedman noted that eBay Inc's (NASDAQ: EBAY), "PayPal is not accepted at 4 of the top 10, or 32 of the top 100 Internet Retailers. Since revenue of the top 10 Internet Retailers accounts for ~60% of the top 100 companies, PayPal is present at only ~53% of the total online sales revenue of the top 100 companies."

Friedman deflects this statistic and flips it to support his upgrade of eBay from Neutral to Positive by highlighting PayPal's large merchant market share possibility. Friedman had conversations with other merchants which resell PayPal that say acceptance is improving post spin. If PayPal is able to secure contracts from any of the 32 companies mentioned above, if not multiple contracts, how much would that increase growth in present value?

Merchant conversion total present value estimations calculated by Friedman for the top 10 would increase PayPal somewhere between 14-29 percent; the top 100 would augment total present value approximately 18-36 percent. These merchant conversions spark the thought of high upside and Friedman reflects this by raising his price target from $59 to $75.

Shares of eBay recently traded at $58.84, down 1 percent.