NEW YORK (TheStreet) -- Shares of eBay Inc (EBAY) - Get Report were down 0.94% to $59.16 in early market trading Tuesday, despite receiving a higher rating by analysts at Axiom Capital earlier this morning.
The firm upgraded the online auctioning site to "buy" from "hold" and issued a higher price target of $70 from its prior $60 price objective.
eBay was upgraded ahead of its PayPal spin-off, as analysts say the payment service is battling competitive concerns better-than-expected.
The firm also noted that eBay's growth rate challenges are easing. Axiom added that eBay has been stuck within a range of between $55 to $60 per share this year, but comps seem to be getting easier in the second half of the fiscal year.
Last September, the e-commerce giant announced its plan to separate the online marketplace from PayPal, its growing mobile payment processing unit it bought back in 2002.
The move followed several months of pressure from activist investor Carl Icahn for the two divisions to split since the company's traditional e-commerce business had been slowing.
San Jose, Calif.-based eBay is a global technology company that enables commerce through reportable segments including marketplaces, payments and enterprise.
Separately, TheStreet Ratings team rates EBAY INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate EBAY INC (EBAY) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its solid stock price performance, compelling growth in net income, revenue growth, notable return on equity and reasonable valuation levels. We feel its strengths outweigh the fact that the company shows weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Internet Software & Services industry. The net income increased by 126.9% when compared to the same quarter one year prior, rising from -$2,326.00 million to $626.00 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 5.6%. Since the same quarter one year prior, revenues slightly increased by 4.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Internet Software & Services industry and the overall market, EBAY INC's return on equity exceeds that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: EBAY Ratings Report