Market Overview

Search Engine Optimization Helping eBay Attract New Users

Share:
Search Engine Optimization Helping eBay Attract New Users

Reviewing the third-quarter results of eBay Inc (NASDAQ: EBAY), CLSA said improved search engine optimization is driving new users, with SEO firm Searchmetrics pitching the sequential growth at 20 percent.

However, analyst James Lee indicated that addition of active buyers was slow in the quarter, at 1 million, down from 2 million in the second quarter. The weakness was attributed to tougher comparisons stemming from heavy promotions in India last year.

CLSA termed the third-quarter performance of eBay as mixed. The guidance for the fourth quarter was largely unchanged, as the deceleration in the gross merchandize volume was offset by a higher take rate from lower contra-revenue promotional activity.

The firm sees uncertainty for gross merchandize volume growth due to mix shift to brand spending delaying sales cycles in the near term.

Related Link: Goldman Sachs Revises Estimates For eBay

CLSA expects user experience to become better over time, as search results on eBay will be based on products and not merchants. The firm also noted that more than 500,000 merchants in the United State use the new Seller Hub tool, which is meant to optimize efficiencies for merchants. The product was launched in Europe in the third quarter of 2016.

CLSA raised its 2018 non-GAAP earnings per share estimate by 1 percent to $2.21 from $2.19, citing cost controls and higher take rates. The firm maintained its Underperform rating on the shares of eBay, but raised its price target to $30 from $27.

At the time of writing, eBay shares were down 11.33 percent at $28.84.

Full ratings data available on Benzinga Pro.

Do you have ideas for articles/interviews you'd like to see more of on Benzinga? Please email feedback@benzinga.com with your best article ideas. One person will be randomly selected to win a $20 Amazon gift card!

Latest Ratings for EBAY

DateFirmActionFromTo
Oct 2019MaintainsNeutral
Oct 2019MaintainsHold
Oct 2019MaintainsOverweight

View More Analyst Ratings for EBAY
View the Latest Analyst Ratings

Posted-In: Analyst Color Earnings News Guidance Short Ideas Price Target Reiteration Analyst Ratings Best of Benzinga

 

Related Articles (EBAY)

View Comments and Join the Discussion!

Mid-Afternoon Market Update: Crude Oil Down Over 2.5%; American Express Shares Gain On Earnings Beat

Bernie Sanders And Rep. Cummings To Ariad: Explain Why Iclusig Now Costs $199,000 A Year