NEW YORK (AP) ? eBay rose in premarket trading Thursday after the online auctions company beat quarterly expectations and provided a healthy outlook for the year.
For all of 2012, the company is forecasting adjusted earnings of $2.25 to $2.30 per share on revenue of $13.7 to $14 billion. Analysts had been looking for only $2 per share in earnings and $11.59 billion in revenue.
The San Jose, Calif., company earned 60 cents per share on an adjusted basis during the fourth quarter, edging out Wall Street expectations by 3 cents. Revenue grew 35 percent and also topped estimates. Results were lifted by strong holiday sales and growth at PayPal, its online payments business.
EBay’s guidance for the current quarter, however, was “conservative,” analysts said. It expects to earn 50 cents to 51 cents per share, versus the average forecast of 54 cents per share.
Gil Luria of Wedbush reiterated an “Outperform” rating and $48 price target on the stock. “We believe PayPal will capitalize on its superior position in mobile payments, extend its 25 to 30 percent growth for several years, turn into eBay’s largest business by 2014 and lead to significant multiple expansion,” the analyst wrote.
Meanwhile, Colin Sebastian of Baird said he views the company’s higher 2013 guidance as “reflective of management’s increasing confidence in the Marketplace turnaround,” referring to the company’s e-commerce businesses, including its namesake website. The analyst maintained an “Outperform” rating.
Shares of eBay Inc. added 96 cents, or 3.2 percent, to $31.30 in premarket trading.