I'll buy when EBAY crashes like AMZN...eBay (EBAY) 59.35 -2.27: Co. remains Goldman Sachs's top pick with exceptional growth trends in Y02. Final four weeks of firm's Q202 listings indicate EBAY's U.S. business continues to accelerate, with results likely inline with consensus revs/EPS ests of $265mln/$0.17, with potential for $2-3 mln revs upside. Firm reiterates Recommended List rating; suggests adding to positions on almost 4% weakness, built up over last two days of trading.
eBay (EBAY) 59.15 -2.47: If you're an EBAY shareholder you're probably a) relieved that your stock has held up so well compared to the rest of the market/Net sector and b) nervous because the market has been methodically seeking out and destroying the relative strength leaders... Knowing the latter, and seeing today's action, EBAY investors have to be asking themselves if now is the time to bail/reduce exposure... In Briefing.com's humble opinion the answer to that question is "yes." Mind you, we continue to think that EBAY the business is rock solid... Company has a top-notch brand, strong balance sheet (a big plus in today's market), experienced, respected management team and clear earnings visibility... Nevertheless, the stock has some near-term issues to contend with including, recent break below minor support at 60, relatively high market/sector risk and uncomfortable p/s ratio of 19.8x... Though its clean financials and impressive growth prospects are likely to insulate the stock from a brutal retreat, high valuations and lousy market tone suggest that it will succumb to some near-term price weakness... Fortunately, the chart gives us a good idea of the downside risk... Initial support comes in at 56.16 (50-day moving average), with a secondary floor at 50... Should note that the 50 area has acted as strong support over the past five months... Consequently, unless the company were to issue an earnings warning, or the market/sector were to fall sharply from here, Briefing.com expects this floor to hold once again. - Robert Walberg, Briefing.com |
