Updated from 9:06 a.m. EDT

eBay ( EBAY) got slapped with a downgrade to sell after the stock's strong run.

The stock is currently up 44% in the past five weeks as investors, anticipating a bottom in the market, spurred a recovery rally. But eBay may not be worthy of all the revived affection, wrote Collins Stewart analyst Sandeep Aggarwal in a research note Monday.

"We believe that 50% appreciation is excessive with no signs of fundamental improvements," Aggarwal wrote.

In particular, Aggarwal argues that eBay's core auction business is in decline, causing both a loss of market share and an erosion of its margins.

Another factor working against eBay is the end of its participation in Microsoft's ( MSFT) Live Search promotion, by which the auction shop offered cashback offers on purchases in the fourth quarter. Without the incentive plan, eBay's sales are likely to lose some juice, Aggarwal suggests.

The Collins Stewart analyst cut his March quarter sales estimate for eBay to $1.91 billion from $1.94 billion and shaved his full-year estimate by 2.5% to $7.86 billion. The Street consensus calls for March quarter sales of $1.95 billion and a full-year revenue total of $8.06 billion.

Shares of eBay were falling 3.1% to $14.56 in recent trading.

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