UPDATE: Citigroup Reiterates Buy Rating, Lowers PT on eBay Following Investor Conversations

In a report published Friday, Citigroup analyst Mark May reiterated a Buy rating on

, but lowered the price target from $65.00 to $64.00. In the report, Citigroup noted, “Based on our recent investor conversations, it was clear heading into this report that investors felt 2H expectations might be too high given tough macro conditions in Europe and the implied 2H acceleration in guidance. eBay management did, in fact, cite this as a reason it would likely now come in at the low-end of CY13 guidance, but guidance remained within the previous range despite fears, and key metrics in 2Q13 were solid and many even accelerated vs. 1Q13. While near-term growth is being impacted by certain international macro factors, eBay's core businesses continue to perform well, rev. growth remains above 15%, ROIC remains above 23%, the long-term thesis remains intact, and the valuation relative to these factors remains attractive at 10x EV/CY14E EBITDA, 17x adj. P/E and a 6% FCF yield (based on after hours price indication). We believe eBay is still on track to grow revs at a 17% CAGR over the next 3 years and to generate $3.83 in EPS in CY15. As such, we maintain our Buy rating and view fair value in the mid-$60s, with potential catalysts including Marketplace improvements driving better conversions and purchase frequency, continue momentum at PayPal (incl. mobile), and possible long-term upside from PayPal's offline efforts.” eBay closed on Thursday at $53.52.