eBay Inc (EBAY Stock) Q4 earnings outlook: Will the bears stay at bay?

eBay Inc. is an American multinational e-commerce corporation that facilitates consumer-to-consumer and business-to-consumer sales through its website making it essentially a platform that allows buyers and sellers to transact together and then it takes a percentage of each transaction as a way of earning its revenue.

eBay Inc has a market capitalization of 34.72B. eBay Inc. is expected to report earnings on 02/23/2022 after market close. The report will be for the fiscal Quarter ending Dec 2021. According to Zacks Investment Research, based on 9 analysts’ forecasts, the consensus EPS forecast for the quarter is $0.82. The reported EPS for the same quarter last year was $0.72. Also, revenue estimates based on a survey of 24 Analyst done by yahoo finance is expected to be 2.61 billion.

In the fiscal third quarter of 2021 which ended on 30th  September 2021 and reported on 28th of November 2021, the company’s revenue was 2.50 billion dollars(+10.76% year/year change) and the net income was 264 million dollars also in the same period, while the earnings per share stood at 0.40, It is important to note that ebay  paid an annual dividend of $0.72 per share that’s an annual dividend yield of 1.29% and the total shareholder return for the past 12 months is 37%.

Since eBay is an e-commerce player and 90% of its revenue come from the purchases made on its online platform means Investors pay attention to the fact that the more the flow of visits to the website the higher the prospect of sales, therefore, making the company highly dependent on its website popularity for revenues. Q4 website visit statistics indicate that there has been a 1.19% rise in total estimated visits, this is according to tip ranks too that measures and analyzes a company’s website visits over a specified period. During the onset of the pandemic, eBay was a beneficiary because users looked to the e-commerce retailer and auction site for goods they needed and wanted while avoiding shopping in person but with economies reopening worldwide the trend seems to be reversing.

Nevertheless according to tipranks eBay price forecast and Target  Based on 11 Wall Street analysts offering 12-month price targets for eBay in the last 3 months. The average price target is $76.36 with a high forecast of $90.00 and a low forecast of $64.00. The average price target represents a 37.68% change from the last price of $55.46. Overall, the stock has a Moderate Buy consensus rating based on 5 Buys and 6 Holds.

eBay price action continues to charge Lower on the daily timeframe chart and is trending upwards below the 200 (blue), 50 (red), and 20 (green) simple moving average and having come off from a high of $81.96 printed on October 22nd last year and trading in a downtrend channel eventually finding support at $54.85. Granted that the RSI is indicating that it is oversold and the ADX reading below 25.00 the downtrend seems to probably have lost some steam here and it will be interesting to see whether the price will remain supported at $54.85 or continue dropping targeting $51.43. If the price bounces off these levels’ resistance should be encountered at $56.88-$57.18 and at $60.04, which is at the upper trendline of the downtrend channel.