Goldman Sachs Comments on eBay's (EBAY) Q1
Goldman Sachs maintained a Conviction Buy on eBay (NASDAQ: EBAY) and trimmed its price target to $64.00 (from $66.00).
Analyst Heath P. Terry said, "eBay reported 1Q revenues of $4.26bn (+13.7% yoy vs. +13.5% in 4Q) and non-GAAP EPS of $0.70 vs. consensus at $4.23bn and $0.67, respectively. Organic revenue growth of 13% was even with 4Q, while active user growth of 14% at Marketplaces and 16% at PayPal were also in line with 4Q. eBay repurchased $1.8bn worth of shares and took a GAAP (non-cash) charge of $3bn to facilitate the eventual repatriation of $9bn in offshore cash, if/when it so chooses, to help facilitate the $3.8bn in remaining repurchase authorization and potential, but unplanned M&A."
"While investments in marketing at PayPal and improvements in the Enterprise business could drive incremental growth, fee changes at StubHub will impact Marketplace revenue through 2014. With signs of growth acceleration, ~$4bn share repurchase in process, with room for more, and shares at 13x 2015 adjusted EPS estimates, we expect eBay to outperform its peers," he added.
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Shares of eBay closed at $54.54 yesterday.