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.
The firm is expected to post adjusted earnings per share of $0.66, slightly lower than its last-quarter level of $0.69. Sales should remain relatively constant for the quarter at $4.369 billion. With improving cost management the company’s pre-tax profits are called at $1.068 billion, up from $803 million.
Organisational changes are in the pipeline for eBay as it looks to strip off PayPal much like it did with Skype in 2011. The market capitalisation of eBay is (at the time of writing) $67.5 billion and the perception is that PayPal on its own could credit a market capitalisation of around $30 billion. Since the amalgamation of eBay and PayPal, both arms have grown so that the range of products available is now more extensive than had originally been the case. One word of caution should be that once PayPal is stripped off it could end up the way of Skype which was acquired by Microsoft less than three years after gaining independence.
In order to try and ensure that this operation runs as smoothly as possible, the pay packages being offered to both eBay president Devin Wenig, and PayPal CEO Daniel Schulman are very generous.
Over the last 18 months the shares have broadly oscillated between the $50-$58 levels and only briefly broken above or below these. This development, if handled correctly, could finally see the shares break above the $59.78 high set in March.