Markets

EBay (EBAY) Gains But Lags Market: What You Should Know

eBay (EBAY) closed the most recent trading day at $58.47, moving +0.58% from the previous trading session. This move lagged the S&P 500's daily gain of 0.84%. At the same time, the Dow added 0.03%, and the tech-heavy Nasdaq gained 2.51%.

Prior to today's trading, shares of the e-commerce company had gained 20% over the past month. This has outpaced the Retail-Wholesale sector's gain of 7.53% and the S&P 500's gain of 3.73% in that time.

EBAY will be looking to display strength as it nears its next earnings release, which is expected to be July 28, 2020. The company is expected to report EPS of $1.05, up 54.41% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $2.79 billion, up 3.99% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.48 per share and revenue of $10.33 billion, which would represent changes of +22.97% and -4.33%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for EBAY. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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. The Zacks Consensus EPS estimate has moved 1.35% higher within the past month. EBAY is holding a Zacks Rank of #1 (Strong Buy) right now.

Valuation is also important, so investors should note that EBAY has a Forward P/E ratio of 16.69 right now. This valuation marks a discount compared to its industry's average Forward P/E of 48.27.

We can also see that EBAY currently has a PEG ratio of 1.43. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Internet - Commerce was holding an average PEG ratio of 3.12 at yesterday's closing price.

The Internet - Commerce industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 152, putting it in the bottom 41% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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