Despite being one of the originators of online marketplaces, the company has hit a snag recently, losing a lot of market value. Even investment banks are now scaling back their expectations of the business. On June 28, Kunal Madhukar, a UBS analyst, downgraded the stock from a ‘Buy’ to a ‘Neutral’, reducing the price target to $48 from $60. Similarly, Morgan Stanely (NYSE: MS) analyst Lauren Schenk warned that new upstarts would start eating into eBay’s market share.
EBAY chart and analysis
Meanwhile, the company’s shares are trading below all daily Simple Moving Averages (SMAs), trending down since November 2021. Recent trading volume spikes helped the shares bounce off the $40 level, possibly creating a new support line for the share price. This continuous downtrend caused the shares to lose over 30% year-to-date (YTD). On the other hand, analysts on Wall Street rate the shares a moderate buy, predicting that the average next 12 months price could reach $55.05, which is 24.04% higher than the current trading price of $44.38.
Looking to the future
Despite the lackluster performance of the shares the company is trying to stay on top of things, which is evidenced by a recent acquisition of a premier non-fungible token (NFT) marketplace, KnownOrigin, that allows artists to create, collect, buy and sell their NFTs utilizing blockchain-supported transactions. Moreover, the company beat on earnings, by posting $2.48 billion in revenue, an annual decline of -6.1% but a beat by $20 million. Similarly, the earnings per share (EPS) was $1.05, a beat by $0.02. Finally, the company is facing much steeper competition than it did when it was one of the only players in the e-commerce world. Poor share performance could be attributed to numerous factors; however, it seems that at the moment, the only certain thing for the share price is more volatility. Buy stocks now with Interactive Broker – the most advanced investment platform Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
