EBay's (NASDAQ: EBAY) negatives and positives appear to balance out in the wake of its second-quarter performance, SunTrust analyst Robert Peck said Wednesday.
EBay's bottom line beat the consensus by a penny, although its revenue missed expectations by a whisker.
But Peck, in a Thursday note, said $0.02 cents of eBay's earnings were derived from stock buybacks and $0.03 cents from a lower tax rate.
On the plus side in Peck's view, eBay noted in a conference Thursday call that it is "open minded" regarding strategic alternatives for its PayPal unit.
EBay settled a dispute over PayPal with activist investor Carl Icahn in April, agreeing to name Icahn's choice to a board seat. In exchange, Icahn backed down from proposing the sale of PayPal at an annual shareholders' meeting.
Also on the plus side: earnings gains from buybacks and lower taxes, as well as robust growth in payments revenue.
Negatives include decelerating growth rate for sold items, to nine percent from 11 percent; narrowing margins, higher customer acquisition costs and a third-quarter outlook below the Street's expectations.
Peck maintains a Neutral rating and $58 target on eBay. He cut his third-quarter forecast to earnings of $0.66 cents a share, on $4.35 billion in revenue, from $0.69 a share and revenue of $4.36 billion.
EBay traded recently at $51.51, up 1.6 percent.
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