NBA Basketball Legend Magic Johnson Launches NFT Collection

Key Insights:

  • NBA basketball legend Magic Johnson launched an NFT collection on NBA Top Shot.
  • The collection consists of 1,600 NFT packs etching his career highlights into history.
  • US sporting franchises are particularly active in the NFT space, with the NBA leading the way.

This week, Magic Johnson announced a new NFT collection. The world of sport and NFTs continue to test the boundaries, with US franchises leading the way into the virtual world.

Both teams across the US sporting franchises and players have embraced Web3, with several sporting icons becoming ambassadors for leading global exchanges.

In 2020, the NBA and Dapper Labs launched the NBA NFT marketplace Top Shot, built on the Flow (FLOW) blockchain.

Since then, the NBA has embarked on a number of projects to drive fan engagement, including the launch of NBAxNFT, an NBA Discord to engage with NBA fans on everything Web3.

Alongside the NBA, players have also embraced the marriage between sports and Web3.

Magic Johnson Launches NFT Collection to Celebrate NBA Career

On Monday, NBA legend Magic Johnson joined the NFT movement with the launch of ‘The Anthology: Magic Johnson.’

The NBA’s Top Shot announced the launch, saying.

“To celebrate one of the most gifted and beloved players in NBA history – a 5X NBA champion, 3X Finals MVP, 3X NBA MVP, 12X NBA All-Star and member of the NBA’s 75th Anniversary Team – we’re doing things differently.”

The announcement went on to say,

“Our partnership with Magic is a special occasion that calls for an all-new collector experience, including a first-of-its-kind Anthology set reserved for iconic plays from NBA legends. The first NBA Top Shot Anthology, dropping June 7, will contain Rare and Legendary Magic Johnson Moments.”

A total of 1,600 packs will be available, priced at $399 each. Each pack will include 1 Moment NFT from either the Rare or Legendary tier.

Those that meet the Top Shot score requirement of 150,000 + can enter the priority queue giving access to 1,200 packs. The remaining 400 packs go to the general queue.

Magic Johnson took Twitter to announce the launch, saying,

“I’m really excited to partner with @nbatopshot to release my first NFTs and bring some of my favorite Moments from my career to fans everywhere. Fans get to see just a few of my favorite plays from my career!

 

Magic Johnson follows in the footsteps of other sporting greats to etch their iconic sporting moments in digital history.

eBay Jumps on the NFT Bandwagon with Great Wayne Gretsky Collection

On Monday, eBay launched its own NFT drop featuring National Hockey League great Wayne Gretsky.

The Polygon (MATIC) based NFTs come in four different tiers of rarity. Only the green tier NFTs were still available for sale. The Gold, Platinum, and Diamond tiers have already sold out.

eBay partnered with web3 OneOf to launch the Gretksy limited edition NFT collection. The collection features animated Wayne Gretksy moves on the ice.

OneOf and eBay have plans to launch more NFT collections featuring athletes who have appeared on the cover of Sports Illustrated.

Taking to Twitter, OneOf announced the launch, tweeting,

“Guess what?! We’re bringing NFTs to your favorite marketplace! Shop @WayneGretzky x @SInow now available on @eBay!”

 

Magic Johnson may also find himself on eBay, having frequently appeared on the cover of Sports Illustrated over the years.

eBay Could Soon Permit Bitcoin, Ethereum, and Altcoin Payments

Key Insights

  • Major e-commerce marketplace eBay could soon make an announcement about cryptocurrency payments.
  • The firm had dabbled with Bitcoin payments back in 2014 too.
  • Since Gen-Z are a priority target for eBay, CEO Jamie Iannone believes evolving technology could be used to cater to the masses.

Multinational eCommerce giant eBay is reportedly looking into accepting cryptocurrency as a means of payment, said CEO Jamie Iannone in a recent interview.

Appeasing Gen-Z and Millennials

The e-commerce marketplace, which aims to be a place for Gen-Z and millennials, is studying the possibility of adding cryptocurrencies as possible means of payment. In a recent interview, Iannone said that the firm could announce on March 10 during its day dedicated to investors.

Iannone said:

“We’re just completing our transition to manage payments where we’re now managing $85 billion of volume on our platform directly. This gives us the ability to open up new forms of payment.”

Interestingly, over the last few months, quite a few surveys have highlighted that millennials tend to be the most crypto-friendly demographic, which explains eBay’s upcoming venture into the crypto-verse.

Until now, the e-commerce platform had shied away from fully embracing cryptocurrencies even though it embraced non-fungible tokens (NFTs) last year May. Without making any official announcement, Iannone pointed out the growing popularity of NFT trading on its platform.

Furthermore, talking about eBay’s stance on emerging technology such as blockchain and cryptocurrencies, Iannone said that the company altered its policies last year to make the e-commerce platform a place to buy and sell anything.

He added that the firm has been looking to integrate crypto payment options for quite some time, owing to the growing demand of the asset class.

Another Shot at Cryptos

While eBay’s decision to integrate cryptos would be much appreciated in the market, this wouldn’t be the company’s first dabble with cryptos. Notably, eBay first tried integrating BTC payments back in 2014, when BTC was still in its nascent stages.

Last year in May, there were speculations that eBay was exploring Bitcoin payment integration and NFT trading. Seemingly, the crypto payment integration plan could now see the light of the day as crypto adoption becomes mainstream.

eBay accepting cryptocurrencies like Bitcoin and Ethereum could further aid mainstream adoption. In the recent interview, when Iannone was asked whether eBay will add digital currencies such as BTC and ETH to the means of payment, he pointed out highlighting the platform’s goals that:

“eBay will be the place where people trade goods, whether they be physical or digital. So over time, you know, we want this to be the marketplace for sustainability.”

Wall Street Week Ahead Earnings: Caesars Entertainment, Home Depot, Lowe’s and Moderna in Focus

Investors will focus on December quarter earnings for stocks that are economically sensitive, which should show better profits than technology stocks. Increasing Treasury yields and risk aversion could hit the stock market hard over the coming months. In addition, investors will closely monitor the latest news on the rapidly spread Omicron coronavirus variant to see how it impacts earnings in 2022.

Earnings Calendar For The Week Of February 21

Monday (February 21)

The New York Stock Exchange and NASDAQ will all be closed on Monday, February 21 for President’s Day.

Tuesday (February 22)

IN THE SPOTLIGHT: CAESARS ENTERTAINMENT, HOME DEPOT

CAESARS: The largest casino-entertainment Company in the U.S. company is expected to report its fourth-quarter loss of $-0.71 per share, up over 58%, better compared to a loss of $-1.7 per share seen in the same period a year ago. The Las Vegas-based company would post revenue growth of over 77% to $2.58 billion.

Caesars Entertainment (CZR) is currently trading at below its historical NTM multiple on 2023e EBITDAR, despite our expectation of >1,000bps higher core casino margins and faster growth. We believe regional casino markets (55% of mix) have structural tailwinds from customers acquired post-COVID and sports betting legalization,” noted Thomas Allen, equity analyst at Morgan Stanley.

“We expect CZR to improve its sports betting / iGaming market share in coming qtrs, a key driver to Gaming stocks in recent years. High leverage now (7.5x at YE21) but significant FCF and a planned Vegas asset should drive leverage to ~5x by YE22, opening up a broader investor base.”

HOME DEPOT: The largest home improvement retailer in the United States is expected to report its fourth-quarter earnings of $3.22 per share, which represents year-over-year growth of over 17% from $2.74 per share seen in the same period a year ago.

The home improvement retailer would post revenue growth of over 7% to $34.6 billion. The company has beaten consensus earnings estimates in most of the quarters in the last two years, at least.

“We are Overweight Home Depot (HD) given its best-in-class nature and structural housing tailwinds beyond N-T disruption from COVID-19. The stock seems attractively valued in the context of a potential 2021/2022 economic/housing boom,” noted Simeon Gutman, equity analyst at Morgan Stanley.

TAKE A LOOK AT OUR EARNINGS CALENDAR FOR THE FULL RELEASES FOR THE FEBRUARY 22

TICKER COMPANY EPS FORECAST
CNP CenterPoint Energy $0.33
HR Healthcare Realty Trust $0.44
HD Home Depot $3.22
M Macy’s $1.91
MDT Medtronic $1.38
PANW Palo Alto Networks $-0.42
TOL Toll Brothers $1.26

 

Wednesday (February 23)

IN THE SPOTLIGHT: LOWE’S

Home improvement retailer Lowe’s is expected to report its fourth-quarter earnings of $1.69 per share, which represents year-over-year growth of over 27% from $1.33 per share seen in the same period a year ago. The company that distributes building materials and supplies through stores in the United States would post revenue growth of over 2% to $20.82 billion.

“We view Lowe’s (LOW) favourably given its longer-term transformation opportunity and structural industry tailwinds, with substantial near-term uplifts from COVID-19 spending shifts that likely translate to longer-term sales retention,” noted Simeon Gutman, equity analyst at Morgan Stanley.

“Assuming a healthy underlying housing backdrop, we think comps can accelerate longer-term from stronger sales/sq ft trends, driven by e-comm accelerating, better in-stocks, product refreshes/exclusive launches, greater traction with Pro initiatives, and removing friction from the customer shopping experience. Combined with productivity initiatives, this should enable EBIT margin expansion going forward.”

TAKE A LOOK AT OUR EARNINGS CALENDAR FOR THE FULL RELEASES FOR THE FEBRUARY 23

TICKER COMPANY EPS FORECAST
BBWI Bath & Body Works $2.25
BCS Barclays $0.29
EBAY eBay $0.82
HEI Heico $0.57
NTAP NetApp $1.07

 

Thursday (February 24)

IN THE SPOTLIGHT: MODERNA

Moderna, the biotech company focused on drug discovery, is expected to report its fourth-quarter earnings of $8.62 per share, which represents year-over-year growth of over 1,340% from a loss of -$0.69 per share seen in the same period a year ago.

The Massachusetts-based biotechnology company would post revenue growth of 1,075% to around $6.71 billion.

“We are Equal-weight Moderna. While we believe there is long-term upside for Moderna, we believe the significant valuation increase associated with the success of the COVID-19 vaccine limits the near-term upside,” noted Matthew Harrison, equity analyst at Morgan Stanley.

“The company has taken an industrialized approach to developing mRNA based therapeutics and has rapidly generated a broad pipeline of 21 programs, 11 of which have entered clinical development. We believe Moderna’s mRNA drug development platform is more diversified and scalable compared with competitors, and is validated through broad partnerships with Merck and AstraZeneca. We see vaccines and rare diseases as the key valuation drivers of the company.”

TAKE A LOOK AT OUR EARNINGS CALENDAR FOR THE FULL RELEASES FOR THE FEBRUARY 24

TICKER COMPANY EPS FORECAST
ADSK Autodesk $0.89
AXON Axon Enterprise $-0.07
SQ Block $-0.06
CVNA Carvana $-0.76
DELL Dell Technologies $1.94
DISCA Discovery $0.84
GCI Gannett $-0.03
NTES NetEase $0.82
NKLA Nikola $-0.46
VMW VMware $1.44
ZS Zscaler $-0.57

 

Friday (February 25)

TICKER COMPANY EPS FORECAST
AES AES Corp. $0.46
CNK Cinemark Holdings $-0.16
DSX Diana Shipping $0.30
SSP E.W. Scripps $0.46
FL Foot Locker $1.46

 

PayPal Shares Sink Most in Nearly Two Years as Earnings Outlook Disappoints

PayPal shares slumped over 25% on Wednesday after the leading global payments company reported mixed earnings in the fourth quarter and its outlook for the next quarter disappointed investors.

As eBay prepares to ditch its payments services, San Jose-based company forecast revenue and profit that are well below expectations for the first quarter of 2022. The company anticipates revenue growth of 6% for the current quarter. That is well below market expectations of nearly 12%.

That prompted several equity analysts to slash their one-year price targets. D.A. Davidson cut the price objective to $166 from $275. Deutsche Bank slashed the price target to $200 from $260. BMO lowered the target price to $180 from $224. JPMorgan cut the target price to $190 from $272. Jefferies slashed the target price to $145 from $200. Cowen lowered the target price to $174 from $221.

PayPal (PYPL) reported weaker than expected 4Q21 results and provided a 2022 outlook short of our below consensus estimates. Key metrics were broadly below expectations and macro factors are affecting growth. We are lowering our estimates/PT and expect the shares to be under meaningful pressure at the open,” noted George Mihalos, equity analyst at Cowen.

PayPal stock slumped over 25% to $131.31 on Wednesday. The stock fell over 27% so far this year after plunging more than 19% in 2021. eBay stock too fell nearly 3% to $58.75.

Analyst Comments

“Following another thesis-shaking guide down, we are maintaining our BUY rating, but lowering estimates and slashing our price target from $275 to $166. PYPL was one of the pandemic’s biggest beneficiaries, but now faces brutal comps amid a painful customer loss (eBay). While the dramatic fall from grace is unnerving, we take solace in several key positives beneath the surface that suggest better trends ahead,” noted Christopher Brendler, MD, Senior Research Analyst at D.A. Davidson.

“Although we understand the temptation to give up, we continue to view PYPL as a long-term winner in an attractive sector. Maintain BUY as we see these issues as transitory and expect marked improvement by 2H22 as headwinds fade.”

PayPal Stock Price Forecast

Thirty-seven analysts who offered stock ratings for PayPal in the last three months forecast the average price in 12 months of $213.44 with a high forecast of $310.00 and a low forecast of $125.00.

The average price target represents a 21.41% change from the last price of $175.80. Of those 37 analysts, 27 rated “Buy”, nine rated “Hold” while one rated “Sell”, according to Tipranks.

Morgan Stanley cut the base target price to $190 from $217 with a high of $274 under a bull scenario and $155 under the worst-case scenario. The investment bank gave an “Overweight” rating on the digital payments giant’s stock.

“We think investors are probably overly preoccupied by the reduced emphasis on NNA growth, and instead should focus on overall eCommerce growth. We remain Overweight while acknowledging eCommerce market growth normalization could take several qtrs,” noted James Faucette, equity analyst at Morgan Stanley.

Technical analysis suggests it is good to sell as 100-day Moving Average and 100-200-day MACD Oscillator signals a strong selling opportunity.

Check out FX Empire’s earnings calendar

Situation on Major US Stocks

Apple climbs higher after another symmetric triangle pattern.

Amazon breaks the horizontal resistance and aims north.

Berkshire Hathaway goes down after the false breakout above the crucial horizontal resistance.

eBay is on the lower line of the channel up formation.

Goldman Sachs is more or less in the same situation but bounces with a promising hammer.

3M breaks the lower line of the wedge and aims south.

Netflix, with an evening star pattern and a false breakout above an important horizontal resistance.

Walmart, Covestro, Airbus and Westfield inside of symmetric triangle patterns. Here, a breakout should happen soon and will show us a direction to follow in the next few weeks or months.

Best Cheap Stocks to Buy Now November 2021

Oftentimes, Big Money buying is institutional activity. We’ll go over what that looks like in a bit. But, the 5 stocks we see as undervalued candidates are CROX, EBAY, MXL, YETI, & CPRT.

At my research firm MAPsignals, we believe that Big Money trading can alert you to the forward fundamental picture of a stock.

We want the odds on our side when looking for the highest-quality stocks.

Up first is Crocs, Inc. (CROX), which makes comfortable casual footwear.

The best candidates tend to have strong performance. Check out CROX:

  • YTD performance (+167.16%)
  • Historical big money signals

Just to show you what our Big Money signal looks like, have a look at the top buy signals Crocs has made the past few years.

Blue bars are showing that CROX was likely being bought by a Big Money player according to MAPsignals.

When you see a lot of them, I call it the stairway to heaven:

Chart, histogramDescription automatically generated
Source: www.MAPsignals.com

But, what about fundamentals? As you can see, Crocs looks strong under the hood:

  • Forward P/E = 22.1
  • 3-year sales growth rate (+10.7%)

Next up is online marketplace operator eBay Inc. (EBAY), which most people know for online auctions.

Check out these technicals for EBAY:

  • YTD performance (+49.1%)
  • Historical big money signals

Let’s look long-term. These are the top buy signals eBay has made since 2015. Clearly the Big Money has been consistent for years:

Chart, histogramDescription automatically generated
Source: www.MAPsignals.com

Let’s look under the hood. As you can see, eBay has grown earnings massively:

  • Forward P/E = 18.9
  • 3-year earnings growth rate (+130.5%)

Another name to consider is MaxLinear, Inc. (MXL), which is a semiconductor maker whose chips power Internet-of-Things devices, connected homes, and infrastructure projects.

Strong candidates for growth usually have big money buying the shares. MaxLinear has that. Also, the stock has been a rocket:

  • YTD performance (+72.9%)
  • Recent Big Money signals

Below are the big money signals MXL has made since 2015. It’s only recently came back on our radar:

Chart, histogram

Description automatically generated

Now let’s look under the hood. MaxLinear’s earnings growth is impressive. I expect more growth in the coming years:

  • Forward P/E = 24.7
  • 1-year earnings growth rate (+17.5%)

Number 4 on the list is YETI Holdings, Inc. (YETI), which is a maker of outdoor and recreation products like coolers, drinkware, and more.

Here are the technicals jumping out at me:

  • YTD performance (+48.5%)
  • Historical big money signals

Below are the big money signals for YETI since 2018:

Chart, histogramDescription automatically generated
Source: www.MAPsignals.com

Let’s look under the hood. YETI has been growing earnings nicely:

  • Forward P/E = 41
  • 3-year earnings growth rate (+156.6%)

Our last cheap candidate is Copart, Inc. (CPRT), which provides online vehicle auctions worldwide.

Check out these technicals:

  • YTD performance (+21.0%)
  • Historical big money signals

Copart has recently been showing up with top Big Money signals:

Chart, histogramDescription automatically generated
Source: www.MAPsignals.com

Now look at these juicy growth numbers:

  • Forward P/E = 37.5
  • 3-year earnings growth rate (+30.5%)

The Bottom Line

CROX, EBAY, MXL, YETI, & CPRT represent top cheap stocks for November 2021. Strong fundamentals and big money buy signals make these stocks worthy of extra attention.

To learn more about MAPsignals’ Big Money process please visit: www.mapsignals.com

Disclosure: the author holds long positions in MXL in personal and managed accounts and no positions in CROX, EBAY, YETI, & CPRT at the time of publication.

Investment Research Disclaimer

How Supply Issues could Influence SP500?

At the same time, many businesses continue to announce plans for further price increases, with most facing higher cost pressures. It will be interesting to see how or when the U.S. consumer starts to pull back.

Upcoming price increases

UPS yesterday was the latest to announce upcoming price increases, joining companies like Kimberley-Clark, Procter & Gamble, Nestlé, and Chipotle, to name just a few that are attempting to offset higher input costs. These moves reinforce the bears argument that inflation will prove to be longer-lasting than the Federal Reserve’s stance that the wave of higher prices is only “transitory.”

Judging from regional Federal Reserve Manufacturing Surveys that have been updated so far, challenges related to supply chain dislocations and labor shortages continue to contribute to the inflationary environment. Meaning manufactures are still struggling to expand output amid raw material shortages, higher input costs, transportation bottlenecks, and a lack of qualified workers. There have been minor improvements with the pace of cost increases easing a bit and respondent outlooks turning more positive.

It will take more than one month of slightly better data for investors to believe the worst of the supply chain mess is behind us, though.

Data to watch today

Economic data today includes advanced reads on Retail and Wholesale Inventories for October. Bulls are hoping inventories have managed to climb from depressed levels brought on by supply chain challenges, especially as we head into the holiday shopping season. Remember, if companies don’t have the products to sell it will be tough to meet earnings and growth forecasts.

Durable Goods Orders for September is also due today. Oil traders today are anxious to see the Energy Information Administration’s weekly oil inventory report after both Brent and WTI oil futures yesterday closed at their highest levels since 2014 when oil was trading close to $100 a barrel.

Investors this morning will also be digesting the Bank of Canada’s latest policy decision. Insiders are expecting the central bank to raise its inflation forecast and further cut its bond purchases. Another reduction will mark the fourth time in the past year that the Bank of Canada has “tapered” its asset purchases, something most other central banks have not yet begun. The Bank of Canada could also announce when it intends to begin interest rate hikes, with some analysts anticipating liftoff as soon as March due to rising inflation.

Such a move could increase fears that other global central banks, including the U.S. Fed, will feel pressured to act more aggressively to combat inflation. Meaning analysts could begin moving up timelines for when the Fed might end asset purchases and begin rate hikes, something that could weigh on bullish outlooks.

Earnings

It’s another busy day for earnings with highlights including BASF, Boeing, Bristol Myers Squibb, CME Group, Coca Cola, eBay, General Motors, Hilton Worldwide, Kraft Heinz, McDonald’s, Norfolk Southern, O’Reilly Automotive, Thermo Fisher, and Twilio. Alphabet (Google) and Microsoft announced after the market close yesterday with both blowing expectations out of the water.

Notably, Google’s advertising revenue, which rose +43%, didn’t appear to take any hits from changes made to Apple’s privacy policies, something cited by both Facebook and Snap. Both Google and Microsoft also saw continued robust growth in their cloud divisions with revenue climbing +45% and +31% respectively. Apple and Amazon will wrap up the the last of the so-called FAAMG stock earnings when they report tomorrow. Stay tuned…

Big Tech Pushing S&P 500… But How Does it End? Amazon, Apple, Facebook, Google, Microsoft and Tesla now make up 24% of the S&P 500. It seems like how they go so goes the overall stock market. Keep in mind, “Big Tech” now makes up about 40% of the entire S&P 500. If the trade finds Big Tech to be overvalued or in some type of bubble the market could take a sizable hit as it deflates.

eBay Stock Is A Big Money Favorite

So, what’s Big Money?

Said simply, that’s when a stock goes up in price alongside chunky volumes. It’s indicative of institutions betting on the shares.

Smart money managers are always looking for the next hot stock. And eBay has many fundamental qualities that are attractive.

This sets up well for the stock going forward. But how the shares have been trading points to more upside. As I’ll show you, the Big Money has been consistent in the shares all year.

You see, fund managers are always looking to bet on the next outlier stocks…the best in class. They spend countless hours sizing up companies, reading reports, speaking to analysts…you name it. When they find a company firing on all cylinders, they pounce in a big way.

That’s why I’ve learned how critical it is to gauge Big Money demand for shares. To show you what I mean, have a look at all the big money signals EBAY has made the last year.

The last few weeks have seen Big Money activity, too. Each green bar signals big trading volumes as the stock ramped in price:

Chart, histogramDescription automatically generated
Source: www.mapsignals.com

In 2021, the stock has attracted 13 Big Money buy signals. Generally speaking, recent green bars could mean more upside is ahead.

Now, let’s check out technical action grabbing my attention:

  • 1-month outperformance vs. Consumer Discretionary Select Sector SPDR Fund (+5.85% vs. XLY)

Outperformance is important for leading stocks.

Next, it’s a good idea to check under the hood. Meaning, I want to make sure the fundamental story is strong too. As you can see, eBay has been growing sales at a healthy rate. Take a look:

  • 3-year sales growth rate (+2.5%)
  • 3-year earnings growth rate (+130.5%)

Source: FactSet

Marrying great fundamentals with technically superior stocks is a winning recipe over the long-term.

In fact, EBAY has been a top-rated stock at my research firm, MAPsignals, for years. That means the stock saw buy pressure, strong technicals, and growing fundamentals. We have a ranking process that showcases stocks like this on a weekly basis.

EBAY has a lot of qualities that are attracting Big Money. And since 2015, it’s made this list 11 times (7 times this year so far), with its first appearance on 4/18/2017… and gaining 136.89% since. The blue bars below show the times that Etsy was a top pick since 2015:

ChartDescription automatically generated
Source: www.mapsignals.com

It’s been a top stock in the consumer discretionary sector according to the MAPsignals process. I wouldn’t be surprised if EBAY makes additional appearances in the years to come. Let’s tie this all together.

The Bottom Line

The eBay rally could have further to go. Big money buying in the shares is signaling to take notice. Shares could be positioned for further upside. Given the historical gains in share price and strong fundamentals, this stock could be worth a spot in a growth-oriented portfolio.

Disclosure: the author does not hold EBAY positions in personal or managed accounts at the time of publication.

Learn more about the MAPsignals process here.

Disclaimer

eBay Stock Is A Big Money Favorite

So, what’s Big Money? Said simply, that’s when a stock goes up in price alongside chunky volumes. It’s indicative of institutions betting on the shares.

Smart money managers are always looking for the next hot stock. And eBay has many fundamental qualities that are attractive.

This sets up well for the stock going forward. But how the shares have been trading points to more upside. As I’ll show you, the Big Money has been consistent in the shares all year.

You see, fund managers are always looking to bet on the next outlier stocks…the best in class. They spend countless hours sizing up companies, reading reports, speaking to analysts…you name it. When they find a company firing on all cylinders, they pounce in a big way.

That’s why I’ve learned how critical it is to gauge Big Money demand for shares. To show you what I mean, have a look at all the big money signals EBAY has made the last year.

The last few weeks have seen Big Money activity, too. Each green bar signals big trading volumes as the stock ramped in price:

Chart, histogram

Description automatically generated

Source: www.mapsignals.com

In 2021, the stock has attracted 10 Big Money buy signals. Generally speaking, recent green bars could mean more upside is ahead.

Now, let’s check out technical action grabbing my attention:

  • 1-month outperformance vs. Consumer Staples Select Sector SPDR Fund (+2.25% outperformance vs. XLP)

Outperformance is important for leading stocks.

Next, it’s a good idea to check under the hood. Meaning, I want to make sure the fundamental story is strong too. As you can see, eBay has been growing sales at a double-digit rate. Take a look:

  • 1-year sales growth rate (+19.88%)
  • 3-year earnings growth rate (+130.48%)

Source: FactSet

Marrying great fundamentals with technically superior stocks is a winning recipe over the long-term.

In fact, EBAY has been a top-rated stock at my research firm, MAPsignals, for years. That means the stock saw buy pressure, strong technicals, and growing fundamentals. We have a ranking process that showcases stocks like this on a weekly basis.

EBAY has a lot of qualities that are attracting Big Money. And since 2017, it’s made this list 11 times, with its first appearance on 4/18/2017… and gaining 118% since. The blue bars below show the times that EBAY was a top pick going back to 2010:

Chart, histogram

Description automatically generated

Source: www.mapsignals.com

It’s been a top stock in the Staples sector according to the MAPsignals process. I wouldn’t be surprised if EBAY makes additional appearances in the years to come. Let’s tie this all together.

The Bottom Line

The EBay rally could have further to go. Big money buying in the shares is signaling to take notice. Shares could be positioned for further upside. Given the historical gains in share price and strong fundamentals, this stock could be worth a spot in a growth-oriented portfolio.

Disclosure: the author holds no position in EBAY at the time of publication.

Learn more about the MAPsignals process here.

Disclaimer

https://mapsignals.com/contact/

For a look at all of today’s economic events, check out our economic calendar.

Why eBay Stock Moved To All-Time High Levels

eBay Stock Gets To New Highs After Q2 Earnings Report

Shares of eBay moved to all-time high levels soon after the company released its second-quarter results. eBay reported revenue of $2.7 billion and adjusted earnings of $0.99 per share, missing analyst estimates on revenue and beating them on earnings.

According to the report, annual active buyers declined by 2% to 159 million while annual active sellers increased by 5% to 19 million. The report was a bit noisy as eBay Korea business was reported as discontinued operations, and it looks that the initial reaction to the earnings report was muted due to the headline revenue miss.

In the third quarter, eBay expects to report revenue of $2.42 billion – $2.47 billion, while adjusted earnings are projected to total $0.86 – $0.90 per share.

What’s Next For eBay Stock?

Analysts expect that eBay will report earnings of $3.95 per share in 2021 and $4.46 per share in 2022, so the stock is trading at a forward P/E of about 17, which is cheap for the current market environment.

The company’s second-quarter report indicated that the number of active buyers declined as economies reopened. However, the world is worried about the spread of the Delta variant of coronavirus, and some countries have already decided to re-introduce strict virus containment measures.

It remains to be seen whether new problems on the virus front will provide additional support to eBay in the third quarter, but it looks that traders are ready to bet that the company’s performance will remain solid in the second half of this year.

S&P 500 is trading near all-time high levels, and many growth stocks are very expensive. In this light, eBay stock has good chances to attract enough interested buyers who search for attractively valued companies. There is more room for multiple expansion, and the stock has a decent opportunity to continue its upside move in the upcoming weeks.

For a look at all of today’s economic events, check out our economic calendar.

eBay Tops Earnings Estimates, Misses on Revenue

The e-commerce leader for physical and digital merchandise, eBay reported better-than-expected earnings in the second quarter but revenue fell short of analysts’ expectations.

The San Jose, California-based e-commerce giant reported quarterly adjusted earnings (EPS) of $0.99 ​ per share, beating the Wall Street consensus estimates of $0.97 per share. But the company’s revenue plunged about 7% to $2.67 billion from a year earlier. That was also lower than the market expectations of $2.97 billion.

eBay forecasts revenue in the range of $2.42 billion to $2.47 billion in the third quarter. eBay’s Board of Directors has also declared a cash dividend of $0.18 per share of the company’s common stock.

eBay shares gained over 1% to $68.03 on Wednesday. The stock has gained over 30% so far this year

Analyst Comments

“Narrow-moat eBay topped consensus estimates for revenue and adjusted EPS in the second quarter, with $2.7 billion and $0.99 per share narrowly eclipsing FactSet consensus estimates of $2.6 billion and $0.96. Results presented mixed signals for investors, with revenue up 11% on a foreign exchange-neutral basis (largely attributable to better-than-expected managed payments penetration) but with the firm seeing softness in promoted listings monetization (down about 7% sequentially by our calculations) and active buyer growth (down 2% from a year ago) to 159 million,” noted Sean Dunlop, equity analyst at Morningstar.

“As the dust settles from a slew of recent corporate actions, including the divestiture of the eBay classifieds business in June and the anticipated sale of eBay’s South Korean marketplace, we anticipate raising our fair value estimate a mid-single-digit percentage, but note shares look fully valued at prevailing market prices.”

eBay Stock Price Forecast

Five analysts who offered stock ratings for eBay in the last three months forecast the average price in 12 months of $75.20 with a high forecast of $81.00 and a low forecast of $65.00.

The average price target represents a 10.56% change from the last price of $68.02. From those five analysts, four rated “Buy”, one rated “Hold” while none rated “Sell”, according to Tipranks.

Piper Sandler cut the price objective to $79 from $81. Credit Suisse raised the stock price forecast to $80 from $78. Evercore ISI lifted the target price to $70 from $66. UBS upped the price target to $67 from $65. Piper Sandler raised the target price to $81 from $71.

Check out FX Empire’s earnings calendar

Today’s Market Wrap Up and a Glimpse Into Thursday

Stocks were mostly higher on the heels of inflation data that could have been worse. The Dow Jones Industrial Average tacked on 220 points to reach a new record high thanks largely to gains in Caterpillar, Goldman Sachs and Home Depot. The S&P 500 was also higher while the tech-heavy Nasdaq edged lower.

Consumer prices inched up 0.5% in July vs. the previous month, sending the consumer price index to a reading of 5.4%. The results were slightly higher than economists had predicted, but the core rate, which excludes food and energy, increased by a modest 0.3%, which was better than expected.

Investors have less to worry about on the inflation front for the time being. According to reports, however, economists are saying the economy is not out of the woods yet and pricing pressure could kick in. As it stands, investors sold out of tech names and flocked to stocks that are more cyclical in nature.

Stocks to Watch

  • Cryptocurrency exchange Coinbase advanced 3% on better-than-expected Q2 earnings and revenue.
  • Meme stock Clover Health reported its Q2 results, and the stock is rallying 7% in after-hours trading. The company grew its revenue 140% vs. year-ago levels and according to management “is on a USD 1.6 billion annual revenue run rate.”
  • Shares of fast-food restaurant Wendy’s gained almost 4% after the company reported better-than-expected Q2 results. Wendy’s lifted its quarterly dividend by 20% to USD 0.12 per share, which is payable in mid-September. The company is also investing in hundreds of delivery kitchens in the coming years amid a partnership with REEF.
  • eBay’s stock fell slightly more than 2% on Q2 revenue results that were lighter than expected. The auction company’s revenue came in at USD 2.67 billion while Wall Street was looking for USD 3 billion.
  • Shares of speaker company Sonos are rallying in extended-hours trading. The stock is up 7% after Sonos reported a surprise profit while the Street was bracing for a loss. The company is benefiting from a trend of consumers doling out more for high-quality in-home entertainment, including speakers.

Look Ahead

On the earnings front, Walt Disney, DoorDash and Airbnb are on tap. Investors will also get another dose of consumer data on Friday when the latest University of Michigan Consumer Sentiment rate is released.

eBay Shares Fall Ahead of Q2 Earnings

The e-commerce leader for physical and digital merchandise eBay is expected to report its second-quarter earnings of $0.97 per share, which represents a year-over-year decline of over 10% from $1.08 per share seen in the same quarter a year ago.

The San Jose, California-based e-commerce giant would post revenue growth of about 4% to $2.97 billion. The company has beaten earnings per share (EPS) estimates at all times in the last four quarters.

According to ZACKS Research, for the second quarter of 2021, eBay expects net revenues of $2.98-$3.03 billion. On an FX-neutral basis, year-over-year growth in revenues is anticipated to be 8-10%. Non-GAAP earnings are anticipated to be 91-96 cents per share.

eBay shares have gained over 30% so far this year. But the stock fell 0.21% to $65.35 on Monday.

Analyst Comments

eBay reports 2Q21 earnings on 8/11 AMC. We updated our model to reflect the sale of the South Korea biz, which is expected to close late 4Q21 / early 1Q22 and mgmt’s recent coloron eBay ramping its ’21 share buyback to $5BN vs. $2BN with the close of the Classified’s biz sale implying ~$4.7BN in buybacks from 2Q-4Q. Given the model changes, DCF-based PT to $72 vs. $65, maintain Market Perform,” noted John Blackledge, equity analyst at Cowen.

“We estimate total revenue of $2.8BN, +24.5% y/y vs expected +29.5% y/yin 2Q21 and +25.5% y/y in 3Q20. We forecast US Marketplace revenue +10% y/y in 3Q21vs +21% in 2Q21, and Int’l Marketplace revenue of +5.3% y/y vs. our estimated +6.6% y/y in2Q21. We now forecast Adj. EBITDA of $915BN, down (2.9%) y/y, implying3Q21 EBITDA margin of 32.5%. We now forecast 3Q21 Adj. EPS of $0.87 vs. $1.10.”

eBay Stock Price Forecast

Five analysts who offered stock ratings for eBay in the last three months forecast the average price in 12 months of $75.20 with a high forecast of $81.00 and a low forecast of $65.00.

The average price target represents a 15.07% change from the last price of $65.35. From those five analysts, four rated “Buy”, one rated “Hold” while none rated “Sell”, according to Tipranks.

Several other analysts have also updated their stock outlook. Credit Suisse raised the stock price forecast to $80 from $78. Evercore ISI lifted the target price to $70 from $66. UBS upped the price target to $67 from $65. Piper Sandler raised the target price to $81 from $71.

Check out FX Empire’s earnings calendar

eBay Nearing Support Ahead of Earnings

eBay Inc. (EBAY) reports Q2 2021 earnings after Wednesday’s closing bell, with analysts looking for a profit of $0.95 per-share on $3.0 billion in revenue. If met, earnings-per-share (EPS) will mark a 12% decline compared to the same quarter last year. The stock sold off more than 10% in April, despite meeting Q1 estimates with a 26.4% year-over-year revenue increase, and rallied into July’s all-time high in the mid-70s.

Riding the Non-Fungible Token (NFT) Wave

The e-commerce provider has outperformed larger rivals so far in 2021, posting a 30% return compared 2.7% for Amazon.com Inc. (AMZN) and less than 1% for Dow component Walmart Inc. (WMT). The explosive growth of non-fungible tokens (NFT) has underpinned revenue and investor sentiment since sales were introduced in May. It’s a perfect place for this initiative, with digital trading cards, music, entertainment, and art backed up by blockchain technology.

eBay discussed this emerging growth channel at the time of the release, noting that “NFTs offer greater access to a broader audience of collectors and creators. In the same way digital publishing brought more exposure for writers, digital collectibles bring greater opportunity for artists and creators. We plan to double down on this idea – combining eBay’s global reach with the principle that anyone can find almost anything on our platform”.

Wall Street and Technical Outlook

Wall Street consensus remains unenthusiastic, with an ‘Overweight’ rating based upon 7 ‘Buy’, 2 ‘Overweight’, 10 ‘Hold’, and one ‘Underweight’ recommendation. No analysts are recommending that shareholders close positions. Price targets range from a low of $59.20 to a Street-high $81.00 while the stock closed Friday’s session on top of the median $66.00 target. This suggests the company will need to raise Q3 guidance to trade at higher prices.

eBay completed a round trip into the 2018 high at 46.99 in June 2020 and broke out, entering an uptrend that stalled just above 60. The stock cleared that barrier in June 2021, lifted into July’s all-time high at 74.13, and turned south into August. It’s currently trading below the 50-day moving average for the first time since May and testing support in the mid-60s. So far at least, this looks like garden variety profit-taking, suggesting even higher prices in coming months.

For a look at all of today’s economic events, check out our economic calendar.

Disclosure: the author held no positions in aforementioned securities at the time of publication. 

Earnings to Watch Next Week: Cable One, BioNTech, eBay, Walt Disney and Baidu in Focus

Earnings Calendar For The Week Of August 9

Monday (August 9)

IN THE SPOTLIGHT: CABLE ONE, BIONTECH

CABLE ONE: The U.S.-based broadband communications provider is expected to report earnings of $11.19 per share for the second quarter, representing a year-on-year increase of over 5% from a year earlier, up from 10.63 per share seen in the same period a year ago.

The Phoenix-based company would post revenue growth of over 17% to $385 million, up from $328.3 million posted a year ago. The company has beaten earnings per share (EPS) estimates in three of the last four quarters, according to ZACKS Research.

BIONTECH: The biotechnology company BioNTech is expected to report earnings of $8.35 per share for the second quarter, representing a year-on-year increase of over 2,000% from a year earlier.

TAKE A LOOK AT OUR EARNINGS CALENDAR FOR THE FULL RELEASES FOR THE AUGUST 9

Ticker Company EPS Forecast
DRNA Dicerna Pharmaceuticals $0.41
APD Air Products & Chemicals $2.36
SGMS Scientific Games $0.01
TGNA Tegna $0.49
DISH Dish Network $0.89
AMC AMC Entertainment -$0.94
OSH Oak Street Health -$0.33
CHGG Chegg $0.37
CABO Cable One Inc $11.19
CF CF Industries $1.56
ACM AECOM $0.72
WES Western Gas Partners $0.57
HALO Halozyme Therapeutics $0.43
QLYS Qualys $0.68
DDD 3D Systems $0.05
CBT Cabot $1.18
NHI National Health Investors $0.84
DOOR Masonite International $2.12
ESE ESCO Technologies $0.82
IPAR Inter Parfums $0.40
STE Steris $1.49
RCKT Rocket Pharma -$0.66
ITCI Intra Cellular Therapies -$0.79
ELY Callaway Golf $0.01
BNTX BioNTech SE $7.54
TSN Tyson Foods $1.60
HE Hawaiian Electric Industries $0.49
ENR Energizer $0.67
SYKE Sykess $0.58
RDNT RadNet $0.14
HBM HudBay Minerals Ord Shs $0.09
ACKAY Arcelik ADR $0.46

Tuesday (August 10)

Ticker Company EPS Forecast
JHX James Hardie Industries $0.28
SYY Sysco $0.60
IHG Intercontinental Hotels $0.46
ARMK Aramark $0.02
TAC TransAlta USA -$0.01
VSH Vishay Intertechnology $0.59
IIVI Ii Vi $0.75
YPF YPF $0.39
PAAS Pan American Silver USA $0.34
PAY VeriFone Systems $0.01
JAMF Jamf $0.05
COKE Coca Cola Bottlingconsolidated $5.78
DAR Darling Ingredients $0.86
TDG TransDigm $2.97

Wednesday (August 11)

IN THE SPOTLIGHT: EBAY

The e-commerce leader for physical and digital merchandise eBay is expected to report its second-quarter earnings of $0.96 per share, which represents a year-over-year decline of over 11% from $1.08 per share seen in the same quarter a year ago.

The San Jose, California-based e-commerce giant would post revenue growth of about 4% to $2.97 billion. The company has beaten earnings per share (EPS) estimates all times in the last four quarters, according to ZACKS Research.

TAKE A LOOK AT OUR EARNINGS CALENDAR FOR THE FULL RELEASES FOR THE AUGUST 11

Ticker Company EPS Forecast
CIB Bancolombia $0.53
DM Dominion Midstream Partners -$0.09
ELP Companhia Paranaense De Energia $0.63
CAE Cae USA $0.14
ENS Enersys $1.20
PRGO Perrigo $0.60
HAE Haemonetics $0.45
AIT Applied Industrial Technologies $1.17
RPRX Repros Therapeutics $0.70
VERX Vertex Inc. Cl A $0.05
WIX WIX -$0.43
WEN Wendy’s $0.18
GOCO Gocompare.Com -$0.03
AZPN Aspen Technology $1.47
FNV Franco Nevada $0.93
RGLD Royal Gold Usa) $0.90
CACI Caci International $5.56
RXT Rackspace $0.18
AVT Avnet $0.79
UGP Ultrapar Participacoes $0.06
EBR Centrais Eletricas Brasileiras $0.28
EBAY eBay $0.96

Thursday (August 12)

IN THE SPOTLIGHT: WALT DISNEY, BAIDU

WALT DISNEY: The world’s leading producers and providers of entertainment and information is expected to report its fiscal third-quarter earnings of $0.55 per share, which represents year-over-year growth of over 580% from $0.08 per share seen in the same quarter a year ago.

The family entertainment company would post over 42% to $16.82 billion. The company has beaten earnings per share (EPS) estimates all times in last four quarters, according to ZACKS Research.

Disney is building content assets that enable it to take advantage of the significant direct-to-consumer streaming opportunity ahead. Disney’s underlying IP remains best-in-class, supporting long term content monetization opportunities,” noted Benjamin Swinburne, equity analyst at Morgan Stanley.

“During this period of FCF pressure from Parks closures, ESPN’s FCF generation is key to driving down leverage. Historical cycles suggest a potential return to above prior peak US Parks revenues in FY23”

BAIDU: The leader in the Chinese search industry in terms of user market share is expected to report its second-quarter earnings of $1.93 per share, which represents a year-over-year decline of over 7% from $2.08 per share seen in the same quarter a year ago.

The Chinese tech giant will report full-year earnings of $8.60 per share for the current financial year, with EPS estimates ranging from $8.28 to $9.09, according to ZACKS Research.

Baidu has provided better disclosure and has struck a constructive tone on its AI initiatives. We find it well-positioned in certain industrial applications. We also like its rich cash position and strategic investments,” noted Gary Yu, equity analyst at Morgan Stanley.

“Our price target reflects materialization of AI investments, but we highlight milder near-term growth vs. peers amid risks from competition. The company appears well-positioned to ride the next Internet wave, but patience is needed. Our price target implies 16x 2022e non-GAAP P/E, vs. the 10-30x trading band since 2018.”

TAKE A LOOK AT OUR EARNINGS CALENDAR FOR THE FULL RELEASES FOR THE AUGUST 12

Ticker Company EPS Forecast
BR Broadridge Financial Solutions $2.19
AEG Aegon $0.15
BAM Brookfield Asset Management USA $0.72
PLTR Palantir Technologies Inc. $0.03
FLO Flowers Foods $0.28
BAP Credicorp USA $9.65
PVG Pretium Resources $0.13
DIS Walt Disney $0.55
BRFS BRF $0.07
SBS Companhia De Saneamento Basico $0.24
AEBZY Anadolu Efes ADR $0.00
MIDD Middleby $2.07
TKC Turkcell $0.16
BIDU Baidu $13.18

Friday (August 13)

There are no major earnings scheduled.

Best Dividend Stocks August 2021

The hallmark way I go about finding the best dividend stocks…the outliers is by looking for quiet Big Money trading activity. Oftentimes, that can be institutional activity. I’ll go over why following the Big Money is so important in a bit. But, the 5 stocks I see as long-term dividend growth candidates are MA, SHW, WSM, EBAY, & ORCL.

Over decades, I’ve learned that the true tell on great stocks is that big money consistently finds its way into the best companies out there… especially dividend paying stocks. Some of the biggest returns ever have come from holding stocks for many years and reinvesting dividends.

I want the odds on my side when looking for the highest quality dividend stocks…and I own many of them.

So, let’s get into it.

Up first is Mastercard Inc. (MA), which is a large credit card company. They’ve been raising their dividend for years.

Let’s first start with the technical picture.

When deciding on a strong candidate for long-term dividend growth, I look for stocks leading in price:

  • 1-month performance (+7.08%)
  • Historical Big Money buy signals

Below are the Big Money signals Mastercard has made since 2015. Blue bars are showing that MA was seeing big buy activity according to MAPsignals. Typically, the more Big Money signals, the stronger the stock:

Chart, histogramDescription automatically generated
Source: MAPsignals.com

On top of technicals, when deciding on the best dividend stock, you should look under the hood to see if the fundamental picture supports a long-term investment. As you can see, Mastercard has a strong dividend history:

  • 3-year dividend growth rate (+45.7%)
  • Current dividend per share = .44
  • Forward yield = .45%
  • 3-year earnings growth rate (+25.12%)

Next up is Sherwin-Williams Co. (SHW), which is a leading seller of paint materials. They’ve also been a dividend grower for years.

When deciding on a strong candidate for long-term dividend growth, it’s a good idea to look for many years of dividend increases.

Now let’s look at the recent performance:

  • 1-month performance (+4.95%)
  • Historical big money signals

Below are the big money signals that Sherwin-Williams has made since 2015. I expect more buy signals in the years to come.

Chart, histogramDescription automatically generated
Source: MAPsignals.com

On top of technicals, when deciding on the best dividend stock, you should look under the hood to see if the fundamental picture supports a long-term investment. As you can see, Sherwin-Williams has a nice dividend history. Their earnings growth has been stellar as well:

  • 3-year dividend growth rate (+16%)
  • Current dividend per share = .55
  • Forward yield = .77%
  • 3-year earnings growth rate (+11.87%)

Next, I’m looking at Williams-Sonoma, Inc. (WSM), which is a leading home retailer company. They have a solid dividend history.

When deciding on a strong candidate for long-term dividend growth, recent underperformance is not a bad thing:

  • 1-month performance (-1.15%)
  • Historical Big Money signals

Below are the big money signals that Williams-Sonoma has made since 2015. It’s recently showed a Big Money buy signal:

Chart, histogramDescription automatically generated
Source: MAPsignals.com

On top of technicals, when deciding on the best dividend stock, you should look under the hood to see if the fundamental picture supports a long-term investment. As you can see, WSM has a strong dividend history:

  • 3-year dividend growth rate (+9%)
  • Current dividend per share = .59
  • Forward yield = 1.5%
  • 3-year earnings growth rate (+46.58%)

Next, I’m looking at eBay, Inc. (EBAY), which is a leading online auction marketplace. They recently added a dividend.

When deciding on a strong candidate for long-term dividend growth, recent outperformance is great:

  • 1-month performance (+6.86%)
  • Recent Big Money signals

Below are the Big Money signals that eBay has made since 2015.

Chart, histogram

Description automatically generated

On top of technicals, when deciding on the best dividend stock, let’s check up on the fundamentals. As you can see, eBay has recently started paying a dividend.

  • 1-2 year dividend growth rate (+14%)
  • Current dividend per share = .18
  • Forward yield = .98%
  • 3-year earnings growth rate (+130.48%)

Lastly, I’m looking at Oracle Corp. (ORCL), which is a leading enterprise technology company. They’ve been growing their dividend for years.

When deciding on a strong candidate for long-term dividend growth, I like to look for recent leaders:

  • 1-month performance (+12.11%)
  • Recent Big Money signals

Below are the Big Money signals that ORCL has made since 2015.

ChartDescription automatically generated
Source: MAPsignals.com

On top of technicals, when deciding on the best dividend stock, you gotta see if the fundamental picture supports a long-term investment. Oracle has been a steady grower:

  • 3-year dividend growth rate (+11%)
  • Current dividend per share = .32
  • Forward yield = 1.46%
  • 3-year earnings growth rate (+93.1%)

The Bottom Line

MA, SHW, WSM, EBAY, & ORCL represent solid dividend choices. Given the strong historical dividend growth and Big Money signals, these stocks could be worth an extra look for a dividend investor.

Disclosure: the author holds no positions in MA, SHW, WSM, EBAY, & ORCL at the time of filming.

To learn more about the MAPsignals process, click here: www.mapsignals.com

Disclaimer

UK Competition Watchdog Approves Adevinta Acquisition of Ebay Classified Ads Unit

The Competition and Markets Authority said in a statement it would not refer the acquisition or eBay‘s purchase of a minority stake in Adevinta to further investigation.

The two companies said in March they planned to sell three smaller British units in order to secure regulatory approval for a long-planned tie-up of their global classified ads businesses.

Adevinta in a statement welcomed the CMA move, and said it targeted completion of the acquisition in the second quarter this year, subject to regulator approval in Austria.

(Reporting by Tom Wilson; Editing by Dhara Ranasinghe)

eBay Shares Slump Over 6% as Q2 Earnings Forecast Disappoints

US e-commerce giant eBay’s shares slumped over 6% in extended trading on Wednesday after the eCommerce leader for physical and digital merchandise forecast earnings less than what Wall Street had expected for the second quarter of 2021.

The San Jose, California-based company forecasts diluted non-GAAP earnings per share (EPS) in the range of $0.91 – $0.96 for the current quarter, below Wall Street’s consensus estimates of $1.02 per share. The company’s revenue is expected to be in the range of $2.98 – $3.03.

Following this, eBay shares slumped over 6% to $58.50 in extended trading on Wednesday.

However, in the first quarter of 2021, the company reported non-GAAP EPS per diluted share of $1.09 on revenue of $3.03 billion, which beat analysts’ EPS expectations of $1.08 on revenue of $2.97 billion, respectively.

eBay has also declared a cash dividend of $0.18 per share of the company’s common stock.

Analyst Comments

“The company guided below the Street. My 2022 EPS number is still much higher than the Street but for now that’s not going to be investor focus. This year the company gave a lower Q2 than Street guide and talked about a challenged back half as people get out more. So, I don’t think investors will swivel and look at the 2022 potential just yet,” noted Chaim Siegel, equity analyst at Elazar Advisors.

“2022 EPS of $7.15 potential with brining payments in-house so 14x $7.15 is almost 70% 12-month upside potential. But again, the focus won’t be next year when the company’s talking about headwinds in growth rates this year.”

eBay Stock Price Forecast

Twenty-one analysts who offered stock ratings for eBay in the last three months forecast the average price in 12 months of $71.67 with a high forecast of $84.00 and a low forecast of $62.00.

The average price target represents a 15.00% increase from the last price of $62.32. Of those 21 analysts, ten rated “Buy”, 11 rated “Hold” while none rated “Sell”, according to Tipranks.

Morgan Stanley gave the base target price of $63 with a high of $79 under a bull scenario and $45 under the worst-case scenario. The firm gave an “Equal-weight” rating on the e-commerce corporation’s stock.

eBay has shifted its strategy to focus on non-new, in-season, refurbished, collectible goods and continues to repurchase shares. New growth drivers, such as Promoted Listings and Payment intermediation (to be rolled out 2021) are on track,” noted Brian Nowak, equity analyst at Morgan Stanley.

Several other analysts have also updated their stock outlook. Evercore ISI raised the stock price forecast to $66 from $65. Credit Suisse lifted the target price to $78 from $76. Piper Sandler increased their price target to $75 from $66 and gave the stock an “overweight” rating.

Moreover, DA Davidson increased their price target to $80 from $67 and gave the stock a “buy” rating. Barclays increased their price target to $84 from $82 and gave the stock an “overweight” rating.

Check out FX Empire’s earnings calendar

Starboard Value Sells 74% Stake in eBay; Buy With Target Price of $64

Starboard Value announced that it sold 74% of its stake in an American multinational e-commerce corporation, eBay, during the second quarter when the activist investment firm ended its proxy fight following the hire of Jamie Iannone as the new CEO of the e-commerce company.

According to a regulatory filing on August 14, the New York-based hedge fund held 2,090,000 shares of the e-commerce company, compared to 7,920,000 it reported in on May 15 filing.

eBay reported that its revenue rose to $2.87 billion in the second quarter, from $2.42 billion a year ago, beating market estimate of nearly $2.8 billion. The e-commerce company forecast a full-year adjusted profit between $3.47 and $3.59 per share.

eBay shares ended 0.018% higher at $56.29 on Friday. The stock is up over 40% so far this year.

eBay stock forecast

Twenty-seven analysts forecast the average price in 12 months at $62.32 with a high forecast of $82.00 and a low forecast of $52.00. The average price target represents a 10.71% increase from the last price of $56.29. From those 27, 11 analysts rated ‘Buy’, 16 rated ‘Hold’ and none rated ‘Sell’, according to Tipranks.

Morgan Stanley target price is $64 with a high of $71 under a bull scenario and $51 under the worst-case scenario. eBay had its price target upped by stock analysts at Stifel Nicolaus from $68 to $70. The firm presently has a “buy” rating on the e-commerce company’s stock.

Other equity analysts also recently updated their stock outlook. Mizuho upped their target price on shares of eBay to $52 from $46 and gave the stock a “neutral” rating. JPMorgan Chase & Co. upped their target price to $60 from $52 and gave the stock a “neutral” rating. Benchmark upped their target price to $69 from $60 and gave the stock a “buy” rating.

BMO Capital Markets lowered from a “positive” rating to a “market perform” rating and upped their target price for the stock to $59 from $52. At last, Wells Fargo & Co upped their target price to $58 from $50 and gave the stock an “equal weight” rating.

We think it is good to buy at the current level and target $64 as 50-day Moving Average and 100-200-day MACD Oscillator signals a strong buying opportunity.

Analyst view

“Near-term trends are strong, and we remain positive payments and ads…but we think execution on eBay’s 3 new growth pillars (for sustained growth into ‘21) will be key to driving material upside from here,” said Brian Nowak equity analyst at Morgan Stanley.

“eBay has shifted its strategy to lower growth and cost rationalization and is aggressively repurchasing shares. New growth drivers, such as Promoted Listings and Payment intermediation (to be rolled out in full mid-2020) are on track.”

Upside and Downside risks

Upside: 1) eBay stabilizes and re-expands its core marketplace GMV. 2) eBay executes better than expected on the payments and promoted listings opportunities, highlighted by Morgan Stanley.

Downside: 1) core marketplace GMV continues to deteriorate. 2) eBay misexecutes on the payments and promoted listings opportunities.

eBay Could Roll Over Into Intermediate Correction

eBay Inc. (EBAY) sold off 3.1% after last week’s Q2 2020 earnings report, despite beating estimates and guiding Q3 and fiscal year above already-aggressive consensus. The stock has since regained those losses but dwindling volume lowers odds it will challenge the July 13th all-time high at 61.06, at least in the short-term. The apathetic tape also indicates that overbought technical readings are taking hold, raising odds for a long-overdue downturn.

eBay Takes Market Share From Competitors

The e-commerce giant has booked impressive market share gains in the digital retail space as a result of the COVID-19 pandemic. Investors and traders have taken note, more than doubling the stock price since the March low while posting a 57% return in 2020. These outsized gains have raised legitimate doubts about valuation while lifting relative strength oscillators into the most overbought levels in the company’s 22-year public history.

In addition to growing technical challenges, eBay got into hot water in June after the U.S. Attorney’s office in Massachusetts indicted former employees for an alleged cyberstalking campaign that targeted the publisher and editor of a newsletter who wrote critical comments. Early evidence suggests that senior executives were involved in the diabolical decision-making, raising the potential for bearish headlines when testimony is taken later this year.

Wall Street And Technical Outlook

Wall Street rates eBay as a ‘Moderate Buy’, based upon 11 ‘Buy’, 16 ‘Hold’, and 1 ‘Sell’ recommendation. That’s positively bearish compared to other e-commerce plays, suggesting that many analysts think the company is now overvalued. Price targets currently range from a low of $52 to a street-high $82 while the stock is trading $6 below the median $62 target. This placement indicates that price could add additional points with ease, despite growing headwinds.

Technically speaking, eBay has fired on all cylinders since breaking out above 2018 resistance at 46.99 in June. The rally has added 10 points since that time while accumulation readings continue to support higher prices. However, a distribution wave that started in July may be picking up steam, perhaps setting the stage for an intermediate correction that offers a low-risk buying opportunity near the breakout level.