EBAY – Given management’s confidence about their Payments platform, customer growth, and cost control efforts, bearish market expectations are unwarranted, and upside is likely

• eBay Inc. (EBAY:USA) is currently trading well below corporate averages relative to UAFRS-based (Uniform) Earnings, with a 12.2x Uniform P/E, implying bearish expectations for the firm. However, this is likely unwarranted given management’s confidence about their Payments platform, customer growth, and cost control efforts, justifying outperformance going forward
• Specifically, management is confident they are managing the marketplace to better control both the consumer and seller experience, and they are confident they are leveraging data on existing listings to inform product results. Moreover, management is confident they have maintained their focus on driving healthy customer growth and about the sustainability of growth in their Payments business and in their ongoing cost control efforts.