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EBay Shares Fall as Profit, Outlook Trail Analysts' Forecasts

EBay registered profit of 82 cents a share for the first quarter, against analysts' prediction of 87 cents. And the Q2 profit outlook lagged as well.
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EBay  (EBAY) - Get eBay Inc. Report shares fell after the online retailer’s first-quarter earnings and second-quarter outlook lagged analysts’ expectations.

To be sure, Q1 adjusted profit and revenue beat analysts’ forecasts, as consumers have flocked to online buying during the pandemic.

The San Jose, Calif., company registered profit of $569 million, or 82 cents a share, for the first quarter, up from $431 million, or 57 cents, in the year-earlier quarter. The FactSet analyst consensus called for 87 cents a share in the latest quarter.

Adjusted earnings per share totaled $1.09, beating the analyst consensus of $1.07.

Revenue came in at $3.02 billion, up 42% from $2.13 billion a year earlier. The analyst consensus called for $2.97 billion in the latest quarter.

For Q2, eBay is looking for profit of 91 cents to 96 cents a share against the FactSet call for $1. The company estimates revenue at $2.98 billion to $3.03 billion. FactSet's consensus: $2.9 billion.

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Shares of eBay recently stood at $58.95, down 5.4%. It’s up 24% year to date amid enthusiasm for vaccines and economic recovery.

"We delivered another strong quarter for the company and an excellent start to the year for our buyers and sellers,” said Chief Executive Jamie Iannon.

“We generated tremendous volume and earnings, with revenue growth the highest it has been since 2005."

In February, eBay reported better-than-expected revenue and earnings for the fourth quarter, boosted its share buyback program by $4 billion, and raised its dividend.

The same day as that earnings report, founder Jim Cramer said, “They've hit it out of the park and I say buy, buy, buy."

Prior to Wednesday’s earnings report, Morningstar analyst David Swartz put eBay’s fair value at $58. 

Ebay has plenty of strengths, he wrote last month. But, “we still harbor concerns about eBay's ability to retain new users and keep occasional users engaged.”