This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

eBay Stock Rises on Rainbows and Unicorns

Stocks in this article: EBAY AMZN WMT

Updated from 12:24 p.m. EDT

SAN FRANCISCO -- Hope springs eternal at eBay (EBAY), despite the company's core business providing little justification for it.

The online auction site's stock was 4.4% higher to $12.14 Thursday, a day after the company laid out to analysts its plan to re-focus itself on growing businesses that are actually growing and scaling back the ambition of its main marketplace site.

Helping eBay shares along was management's projection that it would reach overall revenue of $10 billion to $12 billion in 2011, up from $8.5 billion in 2008.

Let's start there: If battered investors have learned anything from the past six months it's that a projection for what a business will do three years from now -- even with the generous $2 billion leeway -- is about as valuable as the 2004 Eric Gagne Los Angeles Dodger bobblehead that eBay will currently help you buy.

Don't you suppose Citigroup's (C) forecast was fairly cheery in 2006?

Consider the current Street estimates for eBay. In 2009, analysts are calling for a pullback in revenue to $8 billion. For the sake of argument, let's say that seems reasonable enough given the state of consumer fear (note to Thursdays' retail-sales watchers: Consider the impact of the 8% month-to-month gain in gas prices).

So, too, then do estimates for 2010 revenue to essentially climb back to 2008 levels at $8.43 billion.

But then, in 2011 we're supposed to look for as much as a 40% jump in revenue? Either eBay will be proven wrong or Wall Street will, and not a lot of money has been made betting on eBay over the past four years.

1 of 3

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs