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eBay earnings preview: Rises on platform upgrades and lockdown measures

Mohit Oberoi
Author: Mohit Oberoi

Last Updated: April 27, 2020
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eBay is scheduled to release its first-quarter earnings on 29 April, and is expected to see a spike in profits as the auction site benefits from stay-at-home directives and retail closures, according to Wall Street analysts.

The first-quarter earnings season is in full swing and investors are watching the earnings to gauge the coronavirus pandemic’s impact on the company’s earnings. Retail and eCommerce companies have been among the least affected amid the pandemic.

eBay’s earnings per share in the first quarter are expected to rise 10.5% over the period to $0.74, according to the Zack consensus estimate. The San Jose-based firm’s sales are expected to have marginally improved on a year-over-year basis from growth in online consumer spending due to broad-based and increasing social distancing.

The group’s artificial intelligence improvements to personalize data and enhance image searches technology and customer support are expected to have upgraded the platform.

The company, led by chief executive Scott Schenkel (pictured), has provided more data to its marketplace sellers, including price and restocking guidance, as well as more insight into inventory such as demand signals for the right products, price, and timing.

The coronavirus pandemic is expected to quicken the shift towards eCommerce. On Friday, Stifel analyst Scott Devitt upgraded eBay to a “buy” and raised his target price from $40 to $45.

According to Devitt, “eBay is a direct beneficiary of the current landscape and we see upside to near-term topline results as competing platforms temporarily prioritize food and household necessities and consumer demand for items desired for work and education in the home inflect higher.”

During their fourth-quarter  2019 earnings call, eBay gave a 2020 constant currency organic revenue growth guidance of 1%-3% and a GAAP EPS growth guidance between 4%-8%. Brokers will wait to see if the company revises its 2020 guidance now after the pandemic.

You can check our recommended list of stockbrokers if you want to trade eBay stock. There is a separate list of best CFD brokers.

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    Mohit Oberoi

    Mohit Oberoi is a freelance finance writer based in India. he has completed his MBA with finance as majors and also holds a CFA charter. He has over 13 years of experience in financial markets. He has been writing extensively on global markets for the last six years and has written over 6,500 articles. He mainly covers metals, electric vehicles, asset managers, and other macroeconomic news. He also loves writing on personal finance and topics related to valuation.

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