Needham & Company Remains Sidelined on eBay (EBAY) Following 3Q Report
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Needham & Company reiterated a Hold rating on eBay (NASDAQ: EBAY) following the company's 3Q earnings report. eBay reported GMV of $20.1B, up 3% y/y or 5% ex-FX, and revenue of $2.2B, up 6% y/y or 8% ex-FX, slightly ahead of consensus estimates. eBay posted non-GAAP EPS of $0.45 for 3Q16, above consensus of $0.44, representing 3% y/y growth.
Analyst Kerry Rice commented, "eBay posted slight 3Q16 upside, despite active buyers and GMV, particularly in the U.S. modestly disappointed. Marketplace revenue upside was driven by lower contra, a one-time VAT settlement, as well as strength in StubHub and Classified. EPS upside was driven by revenue upside and lower than expected G&A. Q4 guidance was slightly below expectations, but we believe the focus is squarely on 2017. While we estimate revenue to accelerate slightly in 2017, upside maybe limited given the tougher StubHub comps and uncertain revenue growth trajectory driven by the ongoing rollout of structured data pages. We are also concerned that operating margin could shrink with a shift in revenue mix towards the lower margin faster growing platforms, increased branded marketing, and acquisition integrations. Therefore, we remain at a HOLD."
Shares of eBay closed at $32.52 yesterday.
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