Today’s Research Reports on Stocks to Watch: eBay and PayPal
Shares of eBay headed lower in Wednesday trading after a report on the company’s UK business revenues may have had traders scratching their heads. Shares of PayPal, which spun off from eBay just a couple of years ago, hit a brand new high after a Morgan Stanley analyst upped his price target on the stock and gave it an “outperform” rating.
RDI Initiates Coverage on:
PayPal Holdings, Inc.
eBay Inc. shares closed down 1.36% on a little over 11 million shares yesterday. It was reported yesterday that the e-commerce auction company’s UK accounts have recorded only £200m in revenues and they came from a Swiss parent firm rather than through the company’s UK business. A spokesman for the company said, "In all countries and at all times, eBay is fully compliant with national, EU and international tax rules including those of the OECD, including the remittance of VAT to the appropriate authorities." eBay UK provides "services to eBay International by recommending market penetration and advertising strategies for the UK internal marketplace and related third party advertising sales in the UK, Germany, Italy, Belgium and Australia." eBay shares are up 29% this year so far.
Access RDI’s eBay Inc. Research Report at:
PayPal Holdings, Inc. shares closed up 2.63% yesterday after an analyst upgraded the stock to "overweight." Analyst James Faucette of Morgan Stanley wrote in a note, "PayPal’s probably never going to look cheap again. With PayPal maintaining its massive acceptance lead among leading e-commerce websites vs. other digital wallets, competitive concerns have dissipated and the company appears well-positioned to disproportionately benefit from e-commerce tailwinds." Faucette additionally wrote, "We believe the market may be overly concerned about potential negative impact of an eBay contract renegotiation. We think the most likely renewal structure will feature rebates from PayPal to eBay, kicking in after 2021. This renewal structure likely represents only a 5% to 13% drag to PayPal (earnings) after 2021." The analyst also upped his price target on the stock from $62 to $72. PayPal hit a new high of $68.42 yesterday. Shares are already up 71% this year so far.
Access RDI’s PayPal Holdings, Inc. Research Report at:
Our Actionable Research on eBay Inc. (NASDAQ: EBAY) and PayPal Holdings, Inc. (NASDAQ: PYPL) be downloaded free of charge at Research Driven Investing.
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