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What to Expect from eBay Inc. (EBAY) this Earnings Season?

eBay Inc.EBAY will report fourth-quarter 2016 earnings on Jan 25 after the bell. Over the last one year, the stock has underperformed the Zacks Internet - Commerce industry. It has gained 17.24% compared with the industry's gain of 31.31%.

The company has a Zacks Rank #4 (Sell) and an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter .

eBay Inc. Price and EPS Surprise

eBay Inc. Price and EPS Surprise | eBay Inc. Quote

Per our proven model, a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to beat estimates. We don't recommend Sell-rated stocks (Zacks Rank #4 or #5) going into the earnings announcement.

However, eBay's surprise history has been much impressive, since the company has beaten estimates in three of the last four quarters and matched estimates on one occasion.

What Happened Last Quarter

eBay's third-quarter earnings surpassed the Zacks Consensus Estimate on revenues that also beat estimates. The results were driven by continuous strong performance across Marketplace, StubHub and Classifieds. The company added 1 million active buyers in the third quarter taking the total to 165 million.

What We Are Watching

Last quarter, eBay acquired Corrigon Ltd., which it expects will contribute significantly to its Marketplace platform's structured data initiative. It also closed the acquisitions of Ticket Utils and TicketbiS that are expected to improve seller tools.

The company added Qualcomm, Mattel, Fender and Magic Chef to its strategic brand partner's list to attract more customers to its online properties. It rolled out curated experiences in Fashion, Home and Garden and eBay ShopBot on Facebook Messenger for a better user experience.

StubHub rolled out a combined primary and secondary ticket experience for the Philadelphia 76ers, and enabled users to obtain support through a Skype chatbot. Seller hub continued to drive more engagement from consumer sellers.

eBay sold most of its stake in MercadoLibre, Inc., a move that is expected to realize considerable gain on investment.

Summing Up

eBay's unique capabilities backed by technological improvements give it an edge over competitors. We remain positive about the pace of building a solid foundation of structured data and artificial intelligence, increasing personalizing capacities and enhancing mobile experience.

Stocks to Consider

You could consider the following stocks with a positive Earnings ESP and a favorable Zacks Rank:

Seagate Technology plc STX , with an Earnings ESP of +1.87% and Zacks Rank #1. You can see the complete list of today's Zacks #1 Rank stocks here .

Corning Incorporated GLW , with an Earnings ESP of +2.27% and a Zacks Rank #2.

Microsoft Corporation MSFT , with an Earnings ESP of +1.28% and a Zacks Rank #2.

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Seagate Technology PLC (STX): Free Stock Analysis Report

eBay Inc. (EBAY): Free Stock Analysis Report

Microsoft Corp. (MSFT): Free Stock Analysis Report

Corning Inc. (GLW): Free Stock Analysis Report

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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.


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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