eBay (EBAY) closed at $44.15 in the latest trading session, marking a +1.82% move from the prior day. The stock outpaced the S&P 500's daily gain of 1.48%. At the same time, the Dow added 2.21%, and the tech-heavy Nasdaq gained 0.77%.
EBAY will be looking to display strength as it nears its next earnings release. In that report, analysts expect EBAY to post earnings of $0.77 per share. This would mark year-over-year growth of 13.24%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.48 billion, down 7.86% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.10 per share and revenue of $9.70 billion. These totals would mark changes of +9.54% and -10.17%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for EBAY. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 3.72% higher. EBAY is currently a Zacks Rank #2 (Buy).
Valuation is also important, so investors should note that EBAY has a Forward P/E ratio of 16.76 right now. For comparison, its industry has an average Forward P/E of 46.91, which means EBAY is trading at a discount to the group.
Investors should also note that EBAY has a PEG ratio of 1.35 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Internet - Commerce was holding an average PEG ratio of 1.56 at yesterday's closing price.
The Internet - Commerce industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 42, putting it in the top 17% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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