Wedbush Says Settlement of Merchant Litigation Could Provide Windfall for PayPal Margins (EBAY)
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Price: $54.64 +0.29%
Rating Summary:
34 Buy, 8 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 11 | Down: 18 | New: 13
Rating Summary:
34 Buy, 8 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 11 | Down: 18 | New: 13
Trade EBAY Now!
Shares of eBay (Nasdaq: EBAY) are underperforming the US's major indices (which have fallen about 1.2 percent on average) despite a bullish research note from Wedbush's Gil Luria earlier. The stock is down about 1.6 percent from Thursday's closes.
The analyst expects eBay shares to perform strongly as the company "transforms into a payments-driven company and garners Visa (NYSE: V)/MasterCard (NYSE: MA) like multiples." Luria sees "significant value over the next few years" as eBay "extends its support of retailers from the online realm onto their entire footprint."
"We believe that a reported settlement between Visa, MasterCard and the banks with retailers may include some interchange concessions, temporary or permanent. If this is the case, we believe that PayPal would benefit from the lower interchange alongside the retailers involved in the litigation," according to the Wedbush analyst.
Luria reiterated an Outperform rating and $48 price target on eBay shares. With eBay shares last trading at $40.33, the analyst's price target represents potential upside of about 19 percent.
To track all the market-moving analyst calls on shares of eBay, visit our Analyst Ratings page.
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The analyst expects eBay shares to perform strongly as the company "transforms into a payments-driven company and garners Visa (NYSE: V)/MasterCard (NYSE: MA) like multiples." Luria sees "significant value over the next few years" as eBay "extends its support of retailers from the online realm onto their entire footprint."
"We believe that a reported settlement between Visa, MasterCard and the banks with retailers may include some interchange concessions, temporary or permanent. If this is the case, we believe that PayPal would benefit from the lower interchange alongside the retailers involved in the litigation," according to the Wedbush analyst.
Luria reiterated an Outperform rating and $48 price target on eBay shares. With eBay shares last trading at $40.33, the analyst's price target represents potential upside of about 19 percent.
To track all the market-moving analyst calls on shares of eBay, visit our Analyst Ratings page.
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Preypal
Philip Cohen on Jul 6, 2012 06:01 PMMark as Spam | Reply to this comment
Now that Visa’s online digital wallet, V.me, is being beta tested (see buy.com), with MasterCard’s offering soon to follow, the PayPal "pig" will need more than just some new lipstick on it and a "settlement of merchant litigation" for it to survive outside of the atrophying eBay Marketplace, for even another year, I suspect.
As for Donahoe's delusion that PreyPal "mobile" will ever be able to compete with Visa / MasterCard / Amex at physical point of sale, well, next time you drop into Home Depot ask the cashier how PreyPal is going—LOL.
Indeed, I doubt that anything can now save these two most despised entities, eBafia and PreyPal, from the destruction that has been wrought upon them by the headless turkey from Bain & Co, John Edward Donahoe …
And to think that five years ago the stock prices of both eBay and Amazon were ~$40.
And, just for a laugh then, some comment on PayPal’s off-eBay products: "The New Way To Pay In-Store" (at Home Depot), PayPal Here, SmartPay, PayPal Digital Wallet, PayPal Debit MasterCard, PayPal Local and Watch With eBay ...
http://bit.ly/MqwRY0
“Shill Bidding on eBay: Case Study #5”
http://www.ecommercebytes.com/forums/vbulletin/showthread.php?p=167554
eBay / PayPal / Donahoe: Dead Men Walking