The E-commerce’s Boom? (EBAY)

eBay Inc (EBAY)

Not even the dotcom bubble could damper the success story of eBay, but it begs the question, will it remain inflated during the COVID-19 pandemic or will we see its bubble burst?

E-commerce has become big business and a very lucrative way for companies to channel more revenue which is currently amplified by the coronavirus pandemic outbreak.

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Fundamentals

eBay has diversified beyond its online auction beginnings and has become a well-rounded offering which facilitates customer to customer and business to customer sales through its platform. The latest earnings for the first quarter showed and a mixed picture. The company reported a better than expected earnings per share of $0.77, with a 2% drop in revenue from a year ago.

The company’s Marketplace platforms saw a surge in demand while its Classifieds platforms were impacted by the temporary dealer closures and advertising slowdown. eBay expects second-quarter adjusted earnings of $0.73 to $0.80 a share and net revenue of $2.38 billion to $2.48 billion.

eBay Inc (EBAY) share overview:

• Sector: Consumer Discretionary
• Market Cap of $30.53 billion.
• Dividend Yield: 1.5 %
• Price/Earnings (LTM): 21.1x
• Price/Book: 14.4x
• Next Earnings: 15^th of July 2020.
• 52 Week Range low of $26.34 and $43.45 per share high.

The multinational e-commerce corporation has also declared a $0.16 per share quarterly dividend, which is going ex-dividend on the 29^th of May 2020. The scheduled dividend payment date is the 19^th of June 2020. For more details on other company’s dividends over the week, head on over to the Nasdaq Dividend Calendar. 

Chart Life

The price action has regained all its 2020 losses incurred by the COVID-19 pandemic sell-off, which has seen the stock trade higher at 20.88% YTD. The resistance level around $45.16 per share will be watched closely to see if the bulls can push the stock higher.

Short interest has also contracted to around 2.9% with the price action now well above analysts’ expectations at $41.48 per share (red line).  

Informed decisions

eBay’s popularity around online auctions and retail sales makes it a well-rounded offering in these uncertain times and well into the future along with other e-commerce giants. The share offers excellent value for your buck compared to its sector peer group. The next earnings release will be more telling if the company is winning the COVID-19 onslaught.

Portfolio particulars

• Portfolio Hold (Current)*
• Portfolio Buy opportunity: above $38.23 per share**
• WhatsTheBeef long term target price: $49.81 per share.

Know your company: eBay Inc (EBAY)

• eBay was founded by Pierre Omidyar in the fall of 1995 and became a notable success story of the dotcom bubble.
• The company manages the eBay website, an online auction and shopping website in which people and businesses buy and sell a wide variety of goods and services worldwide.
• Some of the notable acquisitions by eBay include PayPal, Craigslist, Skype, StubHub and Corrigon to name few.

Click logo to view eBay Inc (EBAY) shares.
on EasyEquities

Source –EasyResearch, eBay, SeekingAlpha, Zacks Investment Research, MarketWatch, Koyfin, Wikipedia.

*Portfolio Hold (Current) refers to investors who already hold the stock within their portfolio.

**Portfolio Buy opportunity refers to Technical level crossed, which might imply that the markets behavior would support the outlook and Close above refers to a share price close above a Technical Resistance level.

Take note – all stock data and pricing were taken on the 25^th of May 2020..

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Follow Barry Dumas
@BEEF_FINMARKETS

Barry is a market analyst with GT247, with a wealth of experience in the investment markets. Now in his tenth year in the markets, Barry "The Beef" Dumas brings a combination of technical analysis and fundamental insights to the table.