Piper Jaffray Weighs In on Facebook Inc (FB) and eBay Inc (EBAY) Following 4Q Results


As the peak of earnings season continues, Piper Jaffray analyst Gene Munster is weighing in this evening on social media giant Facebook Inc (NASDAQ:FB) and e-commerce giant eBay Inc (NASDAQ:EBAY), with mixed ratings and views.

Facebook Inc

Facebook shares are up nearly 9% in after-hours trading, after the company topped Wall Street’s estimates for both revenue and earnings in the fourth quarter.

In reaction, Munster reiterated an Overweight rating on the stock, with a price target of $155, which implies an upside of 64% from current levels. Munster is one of Facebook’s biggest bulls, and he is also one of the top analysts rated who cover the stock.

The analyst commented, “Facebook reported Q4 revenue of $5.84 billion, 9% ahead of Street estimates. The upside was driven by an acceleration in ad monetization during the quarter. ARPU accelerated to 37% growth y/y in Q4 vs 28% in Q3. Looking to the earnings call, we expect commentary around operating expense growth for 2016 (we expect non-GAAP OPEX to grow 35% y/y). Additionally, given negative commentary about the macro environment from Apple last night, we expect Facebook may offer some cautious commentary about the overall macro environment.”

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Gene Munster has a yearly average return of 17.9% and a 58% success rate. Munster has a 33.3% average return when recommending FB, and is ranked #6 out of 3607 analysts.

Out of the 46 analysts polled by TipRanks, 41 rate Facebook stock a Buy, 4 rate the stock a Hold and 1 recommends a Sell. With a return potential of 27%, the stock’s consensus target price stands at $119.78.

eBay Inc

On the flip side, eBay shares are falling nearly 11% in after-hours trading, after the company issued weak guidance for the current quarter and disappointing sales for the holiday period.

Munster commented, “eBay guided 2016 revenue 4% below the Street, which is consistent with our belief that eBay will continue to struggle to return to eCommerce growth. We believe that eCommerce is structurally shifting away from intensive search models towards automated, simplified and/or curated models. We believe repositioning eBay’s brand in the consumer’s mind will continue to prove difficult, however, given EBAY’s valuation we believe these expectations are baked in.”

According to TipRanks, Munster has a 2.6% average return when recommending EBAY. As of this writing, out of the 10 analysts polled by TipRanks in the last 3 months, 5 rate Ebay stock a Buy, while 5 rate the stock a Buy. With a return potential of 25.4%, the stock’s consensus target price stands at $33.13.

 

  • Notwithstanding the constant stream of delusional and disingenuous nonsense that flows from eBay/PayPal, the share prices of these two clunky operators demonstrate the reality …

    Aug 2007: (pre John Donahoe) AMZN ~$40; EBAY ~$40;
    Jul 2015 (pre eBay-PayPal split): AMZN ~$480; EBAY ~$66;
    Jul 2015 (post-split): AMZN ~$530; EBAY ~$28; PYPL ~$37;
    Currently: AMZN ~$625; EBAY ~$23; PYPL ~$34—LOL …

    And, notwithstanding the “spin-off” of PayPal from eBay, eBay and “PreyPal” remain joined at the hip, and anyone that thinks otherwise is simply uninformed; and, thanks to a continuation of most of the imbecilic policies introduced over the eight year reign (2007–2015) of the “Pain from Bain”, John Joseph Donahoe II, the eBay marketplace is continuing on its journey down the toilet; nevertheless, during Johnny Ho’s occupation of the eBay corner office, this cretin and his gang of hand-picked Keystone Kops still managed to obtain for themselves massive, unearned, “performance” bonuses—while the company’s shareholders got not a penny …

    The reality is, PayPal is a clunky, non-deposit insured, virtually non-regulated, “pretend” bank; a payments intermediary that, in the main, rides on the back of the world’s banks’ existing payments systems with no formal agreement with those banks other than PayPal’s operating of a credit card merchant account facility with one of those retail banks. Even more perilous (for PayPal’s shareholders), the great majority of PayPal’s business still originates from its (still) effectively mandated place on the eBay marketplace, so it logically follows that—with the cretinous Johnny Ho-Ho-Ho now sitting at the head of the PayPal boardroom table—”PreyPal” will be accompanying eBay on its journey to the sewage farm.

    The further reality is, PayPal’s “parasitic” payments operation has little long-term future outside of the likes of the atrophying eBay marketplace now that professional online/mobile payments offerings from MasterCard (“MasterPass”) and Visa (“Visa Checkout”) are available to any professional online merchant that has (or can get) a credit card merchant account with a real bank. And, with respect particularly to “mobile” payments, notwithstanding Apple Pay’s disappointing initial showing, methinks Apple Pay, Samsung Pay, Android Pay, “MasterPass”, and “Visa Checkout”, that is, those operators that have formal relationships with the retail banks, will soon enough bury the whole of the clunky, parasitic, “PreyPal” operation—LOL …

    Regardless, eBay is likely to be the most unscrupulous commercial entity operating on this planet; but, have no fear, eBay is an equal opportunity fraudster—demonstrably—they will knowingly aid and abet the defrauding of both buyers and sellers—as long as there is a financial benefit in such fraud for eBay; and if anyone thinks that the clunky payments intermediary “PreyPal” is any more scrupulous, given their poor customer service and lack of any effective mediation of transaction disputes, including a hard-wired bias towards buyers, good luck to all you small merchants who are using “PreyPal” …