Analysts at Credit Suisse have high expectations for eBay Inc (NASDAQ: EBAY) heading into the company's second-quarter earnings report on July 20. The
firm's Paul Bieber maintains an Outperform rating on eBay's stock with an unchanged $44 price target, saying the company is a "rare value story"
with multiple paths toward value creations.
Q2 Expectations
EBay is expected to earn $0.45 per share in the second quarter on revenue of $2.30 billion, which is mostly in line with the
Street's consensus estimate of $0.45 per share and $2.31 billion, Bieber noted in a research report (see Bieber's track record
here).
EBay's first-quarter report did show signs of improvements in Marketplace along with a modest acceleration in U.S. gross
merchandise volume and active buyer growth, the analyst continued. As such, expectations for the second-quarter print include a
continued momentum, especially since the company's 2017 guidance implies further acceleration in the back half of 2017.
Finally, investors should look out for any commentary on "under-appreciated"
assets including the Classified and StubHub businesses.
Beyond Q2
Beyond the second quarter, eBay's status as a "rare value story" is based on four factors:
-
Monetization potential of the "under-appreciated" businesses, which
could be worth $9.5 billion to $12.8 billion.
- Marketplace GMV acceleration driven by new product experiences and marketing initiatives.
- Incremental revenue from an uptake in promoted listing ads.
- Aggressive share repurchases could add $0.10 to 2018's earnings per share.
Finally, the analyst's $44 price target implies a 20x multiple on 2018 Non-GAAP EPS estimates, which represents a modest but
justifiable premium to retail comps that trade at 18x while a 6-percent free cash flow yield also provides compelling valuation
support.
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Reasons eBay Just Won An Outperform Rating From Credit Suisse
Latest Ratings for EBAY
Date |
Firm |
Action |
From |
To |
Jun 2017 |
Credit Suisse |
Assumes |
|
Outperform |
Apr 2017 |
Monness Crespi Hardt |
Downgrades |
Buy |
Neutral |
Apr 2017 |
Argus |
Maintains |
|
Buy |
View More Analyst Ratings for
EBAY
View the Latest Analyst Ratings
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