UPDATE: JP Morgan Lowers PT to $39 on eBay on FX Concerns
JP Morgan reiterates its Neutral rating on eBay (NASDAQ: EBAY) and reduces its price target from $41 to $39.
JP Morgan notes, "We are lowering estimates on EBAY to adjust for weaker EUR and GBP currencies relative to the USD as well as the potential for macro softness overseas. Our 2012 revenue comes down ~2% and PF EPS is ~3% lower (each down ~1% adjusting for FX only). In addition to the negative effect of currency translation, we note that a weaker EUR/USD rate also hurts cross border trade activity in the Marketplace business which in turn negatively impacts payments revenue as well. Cross border trade represents 20% of Marketplace GMV and ~25% of PayPal TPV, and carries higher fees."
EBAY closed at $39.76 on Tuesday.
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