eBay (EBAY) to Report Q3 Earnings: What's in the Offing?

·4 min read

eBay EBAY is scheduled to report third-quarter 2021 results on Oct 27.

For the third quarter, the company expects net revenues of $2.42-$2.47 billion. On a FX-neutral basis, growth in revenues is anticipated to be 6-8% from the year-ago reported figure.

The Zacks Consensus Estimate for revenues is pegged at $2.45 billion, implying a decline of 5.8% from the year-ago reported figure.

Further, the company anticipates non-GAAP earnings of 86-90 cents per share.

The consensus mark for earnings has been unchanged at 89 cents per share over the past 30 days. This indicates growth of 4.7% from the year-ago reported figure.

The company beat the Zacks Consensus Estimate for earnings in three of the trailing four quarters, while matching the same once, with an average of 4.33%.

Let’s see how things have shaped up for this announcement.

eBay Inc. Price and EPS Surprise

eBay Inc. Price and EPS Surprise
eBay Inc. Price and EPS Surprise

eBay Inc. price-eps-surprise | eBay Inc. Quote

Key Factors to Note

eBay’s strong momentum across the Marketplace platform is expected to have contributed well to its top-line growth in the to-be-reported quarter.

The company is likely to have benefited from the increasing number of small businesses turning up to the Marketplace platform in order to expand their reach to customers. This is expected to have bolstered the active seller base on the platform.

The inclusion of easier label printing solutions in the app and enabling faster listings through image or bar code scans are anticipated to have continued aiding the company in delivering an enhanced experience to sellers in the third quarter.

The growing number of sellers are expected to have continued to attract more customers to the platform, which, in turn, is expected to have aided growth in the active buyer base in the quarter under review.

Increased conversions on its platform along with strengthening marketing initiatives are anticipated to have aided the third-quarter performance of the Marketplace platform.

The growing efforts toward the implementation of Artificial Intelligence through personalization, image search technology and customer support are expected to have enhanced the Marketplace platform.

Apart from this, eBay’s strength across Promoted Listings is expected to have continued aiding its momentum across sellers on the back of data-driven recommendations in the third quarter. Also, the solid promoted listings momentum is likely to have contributed well to the performance of the company’s advertisement business.

The growing adoption of the company’s Managed Payments is expected to have continued benefiting it in the quarter to be reported. eBay’s deepening focus on scaling managed payments globally is likely to have been another tailwind.

In addition to these, eBay unveiled Price Guide and Collection tools for trading cards to help enthusiasts view, manage and track the value of their trading card portfolios. This is likely to have benefited the company’s performance in the quarter under review.

However, the rising competitive pressure from e-commerce giants like Amazon is expected to have continued posing challenges to eBay’s market position.

The impacts of eBay’s leveraged balance sheet are expected to get reflected in its third-quarter results.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for eBay this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

eBay has an Earnings ESP of 0.00% and a Zacks Rank #2 at present.

Stocks to Consider

Here are some stocks that you may consider as our model shows that these have the right combination of elements to beat on earnings this season.

Amphenol Corporation APH has an Earnings ESP of +1.02% and a Zacks Rank of 2, currently. You can see the complete list of today’s Zacks #1 Rank stocks here.

CACI International CACI has an Earnings ESP of +4.43% and a Zacks Rank of 2 at present.

TE Connectivity Ltd. TXN has an Earnings ESP of +0.75% and a Zacks Rank of 2, currently.

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Amphenol Corporation (APH) : Free Stock Analysis Report

eBay Inc. (EBAY) : Free Stock Analysis Report

CACI International, Inc. (CACI) : Free Stock Analysis Report

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