eBay set to issue Q4 figures

Markets are expecting the company’s earnings to continue to grow at a similar pace to previous quarters.

On 22 January eBay will release its fourth-quarter figures. The online trading and commerce company is no longer seen as a youthful startup, rather a mature and developed business.

Even though we have continued to see a steady growth in both quarterly and annual profits for the company, the shares over 2013 have plateaued. Part of the reason for this could be that investors are now more focused on actual returns rather than the blue sky. That being said, online sales in the broader sense are only set to increase, and eBay have been at the forefront of this shift in consumer shopping from the start.

Fourth-quarter sales are expected to be around $4.6 billion, which would represent a year-on-year increase of 15% and should increase the company’s total annual sales by just over 14%. The majority of these are from the US but a sizeable percentage is derived from the UK. Considering Ofcom’s assertion that UK online shoppers spend around £1,175 a year – more than any other country and almost double what US shoppers spend at £663 a year – this is not too surprising.

The share price over 2013 was rather range-bound but it now looks to have consolidated. However, with the likelihood of further markets being opened up, such as India in 2014, a fresh impetus could well be seen. Only a break below the 200-day moving average would cause concern.   

eBay chart

The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.