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EBay (EBAY) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research

eBay (EBAY) closed at $48.72 in the latest trading session, marking a -0.2% move from the prior day. This change lagged the S&P 500's 1.2% gain on the day. Meanwhile, the Dow gained 1.7%, and the Nasdaq, a tech-heavy index, added 1.13%.

Wall Street will be looking for positivity from EBAY as it approaches its next earnings report date. The company is expected to report EPS of $0.80, up 17.65% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.13 per share and revenue of $9.86 billion. These totals would mark changes of +10.6% and -8.7%, respectively, from last year.

Any recent changes to analyst estimates for EBAY should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 0.13% higher. EBAY is currently a Zacks Rank #2 (Buy).

In terms of valuation, EBAY is currently trading at a Forward P/E ratio of 15.6. Its industry sports an average Forward P/E of 46.08, so we one might conclude that EBAY is trading at a discount comparatively.

We can also see that EBAY currently has a PEG ratio of 1.26. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Internet - Commerce was holding an average PEG ratio of 1.54 at yesterday's closing price.

The Internet - Commerce industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 51, putting it in the top 21% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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