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Here's What to Expect From eBay's Q4 Earnings Results Tuesday
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Shares of eBay (EBAY - Free Report) popped 0.89% during regular trading hours Monday, one day before it is set to report its fourth quarter financial results. So, let’s see what investors should expect from the e-commerce giant’s earnings Tuesday.
Overview
Today, roughly 10% of eBay’s items are sold via auction and less than 20% of items are second-hand. This might come as a bit of a surprise to some since eBay rose to prominence as an auctioned-based website to buy used goods. The company also announced last year that it will stop using PayPal (PYPL - Free Report) , which it spun off in 2015, as its back-end payments service after 2020. EBay is set to transition to its new Adyen-based payment system—the firm boasts clients such as Uber, Spotify (SPOT - Free Report) , and Microsoft (MSFT - Free Report) .
Investors should note that activist shareholder Elliott Management, which owns more than 4% of eBay stock, last week said that eBay should think about moving on from StubHub and its portfolio of Classifieds properties. “In addition to unlocking substantial value, separating these assets would allow eBay’s management team to refocus its efforts solely on the core Marketplace business,” the firm wrote in a letter to eBay.
EBay said it will “carefully review and evaluate Elliott's proposals.” And the firm might seriously consider Elliott's suggestion since eBay stock has clearly performed far worse than the e-commerce industry average over the last two years. This group obviously includes giants Amazon (AMZN - Free Report) and Alibaba (BABA - Free Report) , but shares of eBay are down roughly 17% over the last year despite its massive post-Christmas rally.
Q4 Outlook
Moving on, eBay’s Q4 revenues are projected to jump 9.73% to reach $2.87 billion, based on our current Zacks Consensus Estimate. This would come in above last quarter’s 6% climb. At the same time, eBay’s gross merchandise volume is projected to pop 3.7% to reach $25.317 billion, based on our NFM estimates, which would fall short of Q3’s 5% GMV expansion.
Meanwhile, eBay’s active buyer base is expected to reach 178.18 million in Q4. This would mark a 1.18 million sequential jump and a 4.8% climb from the year-ago period—Q3’s active buyer base popped 4%.
At the bottom end of the income statement, eBay’s adjusted quarterly earnings are expected to jump 15.25% to reach $0.68 per share. Investors should note that this estimate would come in below Q3’s 19% EPS growth.
Bottom Line
EBay is currently a Zacks Rank #3 (Hold) based mostly on its recent earnings estimate revision activity. The e-commerce firm is expected to release its Q4 financial results after the closing bell Tuesday, so make sure to come back to Zacks for a full breakdown.
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-holds for the year?
Who wouldn't? Our annual Top 10s have beaten the market with amazing regularity. In 2018, while the market dropped -5.2%, the portfolio scored well into double-digits overall with individual stocks rising as high as +61.5%. And from 2012-2017, while the market boomed +126.3, Zacks' Top 10s reached an even more sensational +181.9%.
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Here's What to Expect From eBay's Q4 Earnings Results Tuesday
Shares of eBay (EBAY - Free Report) popped 0.89% during regular trading hours Monday, one day before it is set to report its fourth quarter financial results. So, let’s see what investors should expect from the e-commerce giant’s earnings Tuesday.
Overview
Today, roughly 10% of eBay’s items are sold via auction and less than 20% of items are second-hand. This might come as a bit of a surprise to some since eBay rose to prominence as an auctioned-based website to buy used goods. The company also announced last year that it will stop using PayPal (PYPL - Free Report) , which it spun off in 2015, as its back-end payments service after 2020. EBay is set to transition to its new Adyen-based payment system—the firm boasts clients such as Uber, Spotify (SPOT - Free Report) , and Microsoft (MSFT - Free Report) .
Investors should note that activist shareholder Elliott Management, which owns more than 4% of eBay stock, last week said that eBay should think about moving on from StubHub and its portfolio of Classifieds properties. “In addition to unlocking substantial value, separating these assets would allow eBay’s management team to refocus its efforts solely on the core Marketplace business,” the firm wrote in a letter to eBay.
EBay said it will “carefully review and evaluate Elliott's proposals.” And the firm might seriously consider Elliott's suggestion since eBay stock has clearly performed far worse than the e-commerce industry average over the last two years. This group obviously includes giants Amazon (AMZN - Free Report) and Alibaba (BABA - Free Report) , but shares of eBay are down roughly 17% over the last year despite its massive post-Christmas rally.
Q4 Outlook
Moving on, eBay’s Q4 revenues are projected to jump 9.73% to reach $2.87 billion, based on our current Zacks Consensus Estimate. This would come in above last quarter’s 6% climb. At the same time, eBay’s gross merchandise volume is projected to pop 3.7% to reach $25.317 billion, based on our NFM estimates, which would fall short of Q3’s 5% GMV expansion.
Meanwhile, eBay’s active buyer base is expected to reach 178.18 million in Q4. This would mark a 1.18 million sequential jump and a 4.8% climb from the year-ago period—Q3’s active buyer base popped 4%.
At the bottom end of the income statement, eBay’s adjusted quarterly earnings are expected to jump 15.25% to reach $0.68 per share. Investors should note that this estimate would come in below Q3’s 19% EPS growth.
Bottom Line
EBay is currently a Zacks Rank #3 (Hold) based mostly on its recent earnings estimate revision activity. The e-commerce firm is expected to release its Q4 financial results after the closing bell Tuesday, so make sure to come back to Zacks for a full breakdown.
Apple (AAPL - Free Report) , Facebook , Microsoft, and other tech giants all report earnings this week as well (also read: What to Expect from Apple's Earnings, iPhone, Services & Chinese Revenues).
Zacks' Top 10 Stocks for 2019
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-holds for the year?
Who wouldn't? Our annual Top 10s have beaten the market with amazing regularity. In 2018, while the market dropped -5.2%, the portfolio scored well into double-digits overall with individual stocks rising as high as +61.5%. And from 2012-2017, while the market boomed +126.3, Zacks' Top 10s reached an even more sensational +181.9%.
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