Cantor Remains Positive On Ebay After Yesterday’s Earnings

In a research report released Thursday, Cantor analyst Youssef Squali maintained a Buy rating on Ebay Inc (NASDAQ:EBAY) with a $60 price target, as the company reported relatively in-line fourth-quarter results with revenues of $4.92B vs. FactSet consensus of $4.93B, while proforma EPS of $0.90 was a penny above consensus.

Squali observed, “4Q:14 results were virtually in-line with Street expectations, with strength in PayPal offsetting a weakening Marketplaces. The FY:15 outlook was reduced on the lagging effects of the password reset, Google’s algorithm changes and F/X headwinds. PayPal’s spin-off remains on track for 2H:15 and mgt announced the likely sale of the Enterprise business, a positive in our view given that it should sharpen mgt’s focus on Marketplaces post divestiture.”

Bottom line, “We’re maintaining a BUY rating and $60 PT based on 1) PayPal’s spin-off; 2) valuation; and 3) ~$3B in authorized buybacks.

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