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EBay Beats Earnings Estimates on Strong U.S. Holiday SpendingE-commerce behemoth eBay ( NASDAQ:EBAY ) has surpassed market expectations for quarterly revenue and profit, buoyed by robust U.S. holiday spending and the sustained strength of key focus categories. The company's stellar performance was underscored by a revenue of $2.56 billion, surpassing analysts' estimates and reflecting a strategic emphasis on value-driven consumer segments such as refurbished goods and auto parts. Shares of eBay ( NASDAQ:EBAY ) surged approximately 7% in extended trading, signaling investor confidence in the platform's ability to capitalize on shifting consumer preferences and market dynamics. According to eBay ( NASDAQ:EBAY ) CFO Stephen Priest, the uptick in business activity towards the end of November, particularly in the U.S., mirrored consumers' penchant for value-conscious purchases amid constrained holiday budgets. This trend underscores eBay's pivotal role as a marketplace that caters to a diverse array of buyers and sellers, facilitating transactions across borders and driving sustained growth. The company's proactive measures to enhance shareholder value were further evident with the authorization of an additional $2 billion share repurchase program, reflecting management's confidence in eBay's long-term prospects and commitment to capital allocation strategies that maximize returns for investors. Despite the upbeat results, eBay CEO Jamie Iannone acknowledged challenges in certain international markets, notably the UK and Germany, which experienced sluggish e-commerce growth. In response to evolving market conditions, eBay implemented cost-saving measures, including a workforce reduction of approximately 1,000 roles, signaling a proactive approach to streamline operations and mitigate risks associated with an uncertain economic landscape. eBay ( NASDAQ:EBAY ) remains cautiously optimistic, forecasting revenue for the first quarter in the range of $2.50 billion to $2.54 billion, exceeding analysts' estimates. The company's projected adjusted earnings per share between $1.19 and $1.23 further underscore its confidence in delivering sustained profitability amidst market volatility. Key industry metrics, such as gross merchandise volume, rose by 2% to $18.59 billion in the fourth quarter, highlighting eBay's resilience and ability to adapt to changing market dynamics while maintaining its position as a leading player in the global e-commerce landscape. As eBay ( NASDAQ:EBAY ) navigates the complexities of a rapidly evolving market, its ability to leverage consumer trends, optimize operational efficiencies, and drive innovation will be pivotal in sustaining its growth trajectory and delivering value to shareholders in the long run. In an era defined by economic uncertainty and shifting consumer behavior, eBay's impressive earnings performance serves as a beacon of stability and resilience, reaffirming its status as a cornerstone of the digital marketplace and a trusted destination for buyers and sellers worldwide.
NASDAQ:EBAYLong
by DEXWireNews
EBAY Options Ahead of EarningsIf you haven`t sold EBAY before the previous earnings: or here: Then analyzing the options chain and the chart patterns of EBAY prior to the earnings report this week, I would consider purchasing the 40usd strike price Puts with an expiration date of 2023-12-15, for a premium of approximately $1.65. If these options prove to be profitable prior to the earnings release, I would sell at least half of them. Looking forward to read your opinion about it.
NASDAQ:EBAYShort
by TopgOptions
Ebay Inc Down 5.03% Despite Market's Bullish TrendThe company reported earnings on an adjusted basis, so it may not be directly comparable to analyst estimates or prior periods. On the revenue line, the company reported $2.5 billion, beating estimates by $140 million. In the same quarter a year ago, the company earned $1 per share on revenue of $2.4 billion. The stock is down 5.03% to $38.01 after the report. Ebay Inc's revenue expanded at a faster pace than earnings, signaling a decline in profit margins. Ebay Inc has performed a little below average during the past few months. The firm was recently trading at a 52-week low of $37.93 on October 27, 2023 and set a 52-week high on February 2, 2023 at $52.23. eBay operates one of the largest e-commerce marketplaces in the world, with $87 billion in 2021 gross merchandise volume, or GMV, rendering the firm the sixth- largest global e-commerce company. eBay generates revenue from listing fees, advertising, revenue-sharing arrangements with service providers, and managed payments, with its platform connecting more than 147 million buyers and roughly 20 million sellers across almost 190 global markets. eBay generates just north of 50% of its GMV in international markets, with a large presence in the U.K., Germany, and Australia. Price Momentum EBAY is trading near the bottom of its 52-week range and below its 200-day simple moving average. What does this mean? Investors have been pushing the share price lower, and the stock still appears to have downward momentum.
NASDAQ:EBAYLong
by DEXWireNews
EBAY Options Ahead of EarningsI wonder who is still using Ebay?! I used to have a store there and close it because of their high fees. If you haven`t sold EBAY here, on the active buyers decline: Then you should know that looking at the EBAY options chain ahead of earnings , I would buy the $47.5 strike price Puts with 2023-7-21 expiration date for about $3.70 premium. If the options turn out to be profitable Before the earnings release, I would sell at least 50%. I have chosen that expiration date to allow me to be wrong and not close the position and to have a bigger gain by the expiration date, if EBAY keeps going lower. Looking forward to read your opinion about it.
NASDAQ:EBAYShort
by TopgOptions
EBAY Active buyers declined 13%I remember i was also a user of EBay in the past few years, but i closed my account in January because of their high fees and lack of sales. i got less views per product than before. And i noticed that my personal experience with SHOP Shopify and SSTK Shutterstock selling less or PYPL PayPal high fees was other people`s problem too. and we moved away from those services. Active buyers on eBay declined 13% in the quarter. Revenue fell 6% to $2.48 billion, but above expectations of $2.46 billion. The forecast for earnings of 87 - 91 cents per share is below the average analyst view of $1.01 per share. CFO Stephen Priest: "Those negative (war) impacts will continue through 2022". My buy area is around 37-40usd. Looking forward to read your opinion about it.
NASDAQ:EBAYShort
by TopgOptions
3
EBAY:FUNDAMENTAL ANALYSIS + NEXT TARGET | MUST READ Last month, the online marketplace eBay acquired a specialty NFT marketplace called KnownOrigin. The press release stated that KnownOrigin is the "leading" NFT marketplace. As a cash-rich company, eBay was well positioned to finance this acquisition. However, with limited growth opportunities, the company must be careful not to lose focus on shareholder returns. And the purchase of KnownOrigin is likely a step in the wrong direction. There are three basic phases in the life cycle of a public company: the need for capital, self-financing, and returning capital to shareholders. In the first phase, loss-making companies receive funding from banks and shareholders to build the business in hopes of achieving scale. In the second phase, companies have achieved enough scale to generate positive cash flow, but they continue to invest all available resources to grow the business. In the third phase, growth opportunities are limited, so cash flow must be used to reward shareholders. These phases exist at different levels, and their borders do not have clear lines. For example, a company can return some capital to shareholders while still investing in growth. But the main point is that investors need to know what phase of the life cycle the company is in order to evaluate opportunities. Stocks in each phase can be good investments if management uses cash wisely. As for eBay, it is in phase three because growth opportunities are limited. Consider that in the fourth quarter of 2017, the company generated $2.7 billion in revenue. In the fourth quarter of 2021, it generated only $2.6 billion. In short, quarterly revenue is down almost 4 percent over that time period. However, eBay's earnings per share rose 62% during that time as the company's management bought back billions of dollars worth of its own stock. Even though eBay is no longer growing, it is still a cash-generating machine. As a marketplace, the company doesn't keep inventory, which keeps costs low. It simply connects buyers and sellers and charges a fee. That's why the company's free cash flow (FCF) margin was 25% in 2021 - few businesses have higher margins. Through buybacks, shares are withdrawn from circulation and the remaining shares become more valuable - thus rewarding eBay shareholders. The company also pays a fast-growing dividend - up 58% over the past five years - which helps boost overall returns. This is a great use of cash by eBay management. As of Q1 of 2022, eBay has $4.7 billion left in its stock repurchase plan. Given that its current market capitalization is only $24 billion, this plan is significant. But the company has enough resources to execute it. The company has more than $5 billion in cash and short-term investments on its balance sheet, a quarterly FCF of more than $500 million, and $5.3 billion in long-term investments in other e-commerce and financial technology companies. We hope you anticipate eBay's potential to return capital to shareholders in the coming years. It could be a path to earnings that exceed the market. That assumes, however, that management won't be too distracted. By acquiring KnownOrigin, eBay may be distracted from its goal. Terms of the deal have not been disclosed, but it is likely that the company paid a price that was well within its means. However, even if it is acceptable, the NFT market space is hardly a path to growth. That's why many people don't like this acquisition. What's more, according to DappRadar, KnownOrigin ranks only 41st among NFT marketplaces by volume - at least in the last 30 days. We don't have time to delve into the rabbit hole of NFT. But suffice it to say that NFTs can be more than just a collector's item. They can be used for record-keeping, live event ticketing, reservations, and more. But it doesn't sound like eBay is interested in this potentially innovative side of the NFT market. The company is interested in NFT collectibles and has been experimenting in that direction since May 2021. But according to NonFungible, NFT sales (in dollars) have dropped 90% over the past year. The number of unique customers is also down 42%. Management's desire to stay relevant is understandable. But if eBay doesn't find real growth opportunities, it should focus on shareholder returns. Given current trends, NFT collectibles will not be what management had hoped for. And so jumping into this space could distract management from making the best use of its cash at the moment.
NASDAQ:EBAYShort
by FOREXN1
19
eBay | Fundamental Analysis | MUST READ !eBay was one of the main beneficiaries at the beginning of the pandemic. People turned to the e-commerce and auction site for items they needed and wanted to buy, avoiding in-person purchases. Now the trend is shifting in eBay's favor as the economy around the world recovers. Against this backdrop, the company plans to report Q4 earnings tomorrow. While long-term investors don't usually buy and sell stocks based on short-term events, some employ earnings reports as markers to determine whether to add to their holdings or as a clue to possible bargain opportunities. With that in mind, let's see if investors should buy this retailer's stock before the report comes out. eBay does not own or sell merchandise on its platform. Instead, the company creates and operates a platform that connects buyers and sellers. To generate revenue, eBay charges a different fee for each transaction on the platform. Perhaps buyers and sellers are equally important to eBay's success. Buyers would stop visiting the site if there were no attractive items to buy. Conversely, sellers would stop listing items if there weren't many people willing to buy them. The COVID pandemic brought millions of new buyers to eBay. From the Q2 of 2020 to Q1 of 2021, the total number of active eBay buyers improved from 161 million to 166 million. However, eBay is now reducing the number of active buyers as the economy reopens and buyers have alternatives again. In addition, management has implemented a new strategy of decreased marketing and promotions aimed at lower-cost shoppers. These two forces working together caused the number of active buyers to drop from a peak of 166 million to 154 million at the end of Q3. The decline in the number of shoppers may be one of the main reasons why gross merchandise value (total sales value) fell more than 12% year over year to $19.4 billion. This figure is very important because eBay earns revenue by taking a percentage of this value as a commission. Nevertheless, despite the drop in gross merchandise value, eBay has increased its revenue year after year. How has it been able to achieve this? By increasing the percentage it charges per transaction. eBay's collection rate per transaction increased from 9.2 percent in the second quarter of 2020 to 12.1 percent in the Q3 of 2021. One might assume that sellers are not thrilled with the fee increase. Yet the same cannot be said for the number of sellers on the eBay platform, which has remained unchanged at 19 million over the past year. Perhaps sellers are happy that eBay is offering more services for higher fees. In recent quarters, eBay has been improving its services to encourage more transactions. One of the main friction points on the eBay platform is trust between buyers and sellers, and this is where management has focused its efforts to increase investment. In the latest of these initiatives, eBay announced on Jan. 25 that it will offer an authentication service for trading cards over $750 sold on eBay. Consumers can now shop with peace of mind knowing that eBay will authenticate these cards to make sure they are not counterfeit and come as advertised. Trading cards are an important category on eBay, with a gross merchandise value of $2 billion in the first half of 2021. Authentication comes in addition to pricey handbags, sneakers, and watches. eBay stock is trading at a price to free cash flow ratio of 15.7 and a projected price to earnings ratio of 13.2. These prices are roughly in line with the average sales level of the past five years. In the near term, the company may continue to be challenged by the changing of the stay-at-home trend. In the long term, however, an increasing share of purchases is moving online. In addition, eBay gets a larger share of each transaction and reinvests some of its profits, strengthening its services. eBay may not be an explosive growth stock, but it offers investors good value at the current price. The stock is probably worth buying before or after an upcoming earnings report, especially if you plan to buy and hold it long enough to benefit from the company's growth over time.
NASDAQ:EBAYShort
by FOREXN1
3
EBAY: FUNDAMENTAL ANALYSIS + NEXT PRICE TARGET In 2021, the e-commerce and auction company, eBay, is certainly feeling great. The company attracted a record number of customers at the beginning of the pandemic as people tended to avoid shopping in stores. eBay is using this momentum to optimize business performance. Management expects that many of the customers who signed up during the pandemic won't stick around for long, so it's focusing on retaining high-value customers. This is one of several things investors should know about eBay as the company's stock rises rapidly. At the beginning of the pandemic in the second quarter of 2020, eBay attracted seven million active buyers, the highest in the company's history. eBay continued to attract shoppers over the next year, but that trend reversed in the last quarter. The economic recovery has forced consumers to spend more time away from home. Not surprisingly, fewer buyers turned to eBay, and as a result, the company lost seven million active buyers in the first and second quarters of 2021. Still, the number of active shoppers is 159 million, up 3 percent from the same quarter in 2019. What's more, eBay has made some changes to its promotional activities, targeting more valuable customers, so while the overall number of shoppers is down, the quality of shoppers has improved. Here's what the company's executives had to say about that during its latest earnings call: "In parallel, we have abandoned outdated tactics that led to low-value, infrequent or one-time buyers. Our customer base is beginning to evolve based on this strategy. Compared to last year, the number of these buyers is increasing, and their spending on eBay is increasing even faster. This higher-quality mix of buyers adds value for sellers and will lead to a better state of our ecosystem in the long run." Indeed, while eBay lost the total number of active buyers for the quarter and for the year, it gained high-level buyers who also increased their spending over the period. These VIP shoppers make up 20% of eBay's total number of buyers, but they account for 75% of the total value of purchases. This is in stark contrast to the low-value buyers, who make up half of the total number of buyers but provide only 5% of gross merchandise volume. This new focus will be crucial for the company as it earns revenue through a percentage (take rate) of the total volume of transactions on its platform. eBay has also moved its buyers and sellers to its own payment system. This transition helps streamline the sales process and reduce delays when buyers make a purchase and pay. The combination of lower promotional activity and payment system migration increased eBay's transaction acceptance rate to 11.3 percent in the second quarter, up from 9.2 percent a year ago. These latest changes may improve eBay's long-term profitability, boosting already excellent operating margins over the past decade. The market appears to be impressed by these changes, as eBay stock is up 45% this year. Management is confident enough about its prospects to increase its stock repurchase plan for this year from $2 billion to $5 billion. Experienced investors should pay attention and put eBay on their list of stocks to watch. Check the Links on BIO and If you LIKE this analysis, Please support our Idea by hitting the LIKE 👍 button Traders, if you like this idea or have your own opinion about it, please write your own in the comment box . We will be glad for this. Feel free to request any pair/instrument analysis or ask any questions in the comment section below. Have a Good Day Trading !
NASDAQ:EBAYLong
by FOREXN1
8
EBAY: FUNDAMENTAL ANALYSIS+PRICE ACTION & NEXT TARGET|LONG🔔Since the end of March 2020, eBay's stock price has risen 146%. Due to the unfortunate COVID-19 situation, many people have been forced to turn to reliable online sources to buy goods, and the e-commerce marketplace eBay has received a huge boost from this wave of traffic. Revenue growth accelerated from a 2% year-over-year decline in the first quarter of 2020 to 42% in the first quarter of 2021. So far, investors have boosted the company's stock price by 47% in 2021, compared to the 13.6% return of the broader market as measured by the Nasdaq Composite Index. Should you still think about investing in eBay at current levels? Valuation is always important when assessing the potential growth of a stock. eBay is trading at 19 times the consensus earnings forecast for 2021, which is below the average S&P 500 earnings forecast of 22. The stock could be slightly undervalued, relying on how much eBay will evolve over the long term. Nevertheless, eBay has faced tougher year-over-year growth comparisons this year. In Q2, revenue grew 11% in currency-neutral terms, down 42% in the first quarter and 30% in the year-ago quarter. In the third quarter, management anticipates revenue to increase 6% to 8% on a currency-neutral basis compared to last year's quarter. The stock price is up 7.1% since the Aug. 11 earnings report, but given the slowdown, it's hard to say whether the stock will continue to rise in the near term. However, eBay could accelerate earnings growth again in 2022, based on management's strategy to improve the trading platform business. CEO Jamie Iannone took over in April 2020 and brings with him extensive experience as a chief operating officer of Walmart's e-commerce division. eBay faces growing pressure from new competitors such as Etsy, which posted triple-digit revenue growth in 2020 and added 35.5 million new active buyers. That's more than three times eBay's growth of 11 million active buyers in 2020. In recent quarters, eBay has reported strong results in new categories, including authentic sneakers, trading cards, and high-end watches. Trading cards, for example, brought in $2 billion in gross merchandise volume (GMV) in the first half of the year, and Iannone sees "untapped potential" for further growth in this category. Still, $2 billion GMV isn't much compared to eBay's total GMV of $22 billion in the last quarter, but there's more to the strategy than the category's recent expansion. The point is to provide more in-demand things that attract young people, particularly Generation Z and Millennials who like to shop frequently. Before Iannone joined the company, eBay was concentrated on increasing the overall number of active shoppers without paying attention to the quality of its customers in terms of how engaged they were or how much they spent. As a result, growth in the number of active shoppers slowed to just 1% right before the pandemic in Q1 2020. In essence, Iannone wants to reduce reliance on what he calls "one-time shoppers" and focus on attracting "lifelong enthusiasts" to the marketplace to drive higher growth, which is already yielding good results. For example, eBay has found that a Generation Z shopper will buy $500 sneakers, but then spend another $2,000 on other categories of merchandise. Iannone explained this during eBay's second-quarter earnings call: "We're seeing in watches, where a high-end watch buyer spends $8,000 in non-watch categories, and that's over 50 items, and that's one of eBay's advantages - the cross-category nature of shopping, which is very difficult for other competitors to replicate." Although eBay's number of active buyers fell by 7 million sequentially to 159 million this quarter, that's still a broad customer reach that reflects the wide variety of products eBay offers as the company seeks to attract higher-value buyers. "Compared to last year, the number of these buyers is increasing, and their spending on eBay is increasing even faster," Iannone said. "This better mix of buyers adds value for sellers and will lead to a better state of our ecosystem in the long run." If eBay can attract more high-volume buyers to the marketplace, it will attract more sellers. That, in turn, will lead to more product selection, which will also help attract more buyers and create a growth flywheel. Iannone has breathed new life into eBay, which, in our opinion, makes this stock worth watching even after rising over the past year. There are faster-growing online retail stocks, but eBay is not going away. The company generates a healthy level of free cash flow, which it returns to shareholders through stock repurchases and dividend payments. Over the past year, eBay's free cash flow was $2.9 billion, a high margin of 29 percent compared to total revenue of $10 billion. It's not too late to invest in eBay. If management continues to be successful in attracting young buyers, the stock could generate above-market returns.
NASDAQ:EBAYLong
by FOREXN1
4