eBay (EBAY) Promotions Increased in Jan. & Feb. - Wells Fargo

eBay (NASDAQ: EBAY) promotional activity increased in January and February, noted a report by analyst Matt Nemer of Wells Fargo. Despite this, he remains positive on the stock.

"Our analysis indicates eBay has increased promotions targeted at both buyers and inactive sellers in January and February. This includes the first "completely free" selling promotion (no listing or final value fees) in at least a year, targeted at inactive users. These promotions lead us to believe eBay is attempting to motivate inactive sellers as well as stimulate buyside demand in a number of retail categories, which we think could be related to continued sluggish demand post-holiday," said Nemer.

"That said, our estimates for Q1 are factoring in a 500bp slowdown in yr/yr revenue growth in Marketplaces (the Street is expecting a 200bp slowdown) and a 460bp slowdown in yr/yr GMV growth ex-vehicles, which we think fairly reflects a challenging consumer environment. Either way, investors are likely less focused on fundamentals than the battle with shareholder Carl Icahn and the upcoming proxy and shareholder vote," he added.

Wells Fargo maintained an Outperform rating on eBay (NASDAQ: EBAY) with a price target of $63-$65.

For an analyst ratings summary and ratings history on eBay click here. For more ratings news on eBay click here.

Shares of eBay closed at $59.06 yesterday.

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