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EBay (EBAY) Outpaces Stock Market Gains: What You Should Know

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eBay (EBAY - Free Report) closed at $49.40 in the latest trading session, marking a +1.29% move from the prior day. The stock outpaced the S&P 500's daily gain of 1.1%. At the same time, the Dow added 1.18%, and the tech-heavy Nasdaq gained 1.09%.

EBAY will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $1.03, up 51.47% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.79 billion, up 3.71% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.45 per share and revenue of $10.22 billion. These totals would mark changes of +21.91% and -5.34%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for EBAY. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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. Over the past month, the Zacks Consensus EPS estimate has moved 11.88% higher. EBAY is currently a Zacks Rank #1 (Strong Buy).

In terms of valuation, EBAY is currently trading at a Forward P/E ratio of 14.16. This represents a discount compared to its industry's average Forward P/E of 47.04.

Investors should also note that EBAY has a PEG ratio of 1.11 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. EBAY's industry had an average PEG ratio of 1.57 as of yesterday's close.

The Internet - Commerce industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 49, putting it in the top 20% 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.

To follow EBAY in the coming trading sessions, be sure to utilize Zacks.com.


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