Friday, January 11, 2008

eBay (NASDAQ:EBAY): 4Q will be ahead of consensus estimates - Piper Jaffray

- Piper Jaffray is out positive on eBay (NASDAQ:EBAY) saying believe eBay's 4Q will be ahead of consensus estimates due to strength in listings, likely upside to PayPal estimates, and FX benefits. While increased promotional activity in Q4 will likely have a modest negative impact on the take rate or rev/listing, they believe the strength in listings, FX (Euro up 5.4% q/q), and PayPal upside will offset the lower take rate. Based on listings count and positive FX benefit, the firm believes we could see approximately 2% of revenue upside and $0.01 EPS upside to their estimates of $2.156B in revenue and $0.41 PF EPS, which are both at the high end of guidance ($2.1-$2.5B & $0.39-0.41) and consensus ($2.138B and $0.41).

Maintains Buy and $43 PT. Valuation looks attractive at 17.5x '08 PF EPS.

Notablecalls: I suspect these comments may create some eraly buy interest in EBAY.

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