EBay (EBAY) Off To A Strong Start In Pre-Market Activity

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified eBay ( EBAY) as a pre-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified eBay as such a stock due to the following factors:

  • EBAY has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $655.4 million.
  • EBAY traded 999,175 shares today in the pre-market hours as of 7:32 AM.
  • EBAY is up 13.6% today from Friday's close.

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More details on EBAY:

eBay Inc. provides online platforms, tools, and services to help individuals and merchants in online and mobile commerce and payments in the United States and internationally. Currently there are 17 analysts that rate eBay a buy, no analysts rate it a sell, and 10 rate it a hold.

The average volume for eBay has been 12.5 million shares per day over the past 30 days. eBay has a market cap of $64.7 billion and is part of the services sector and specialty retail industry. The stock has a beta of 0.80 and a short float of 1.8% with 2.12 days to cover. Shares are down 3.5% year-to-date as of the close of trading on Friday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates eBay as a buy. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • EBAY INC has improved earnings per share by 8.2% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, EBAY INC increased its bottom line by earning $2.18 versus $1.99 in the prior year. This year, the market expects an improvement in earnings ($2.97 versus $2.18).
  • The revenue growth significantly trails the industry average of 43.6%. Since the same quarter one year prior, revenues rose by 12.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Although EBAY's debt-to-equity ratio of 0.28 is very low, it is currently higher than that of the industry average. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.20, which illustrates the ability to avoid short-term cash problems.
  • Net operating cash flow has increased to $1,494.00 million or 47.77% when compared to the same quarter last year. In addition, EBAY INC has also modestly surpassed the industry average cash flow growth rate of 41.40%.
  • The gross profit margin for EBAY INC is currently very high, coming in at 74.99%. Regardless of EBAY's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 15.48% trails the industry average.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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