EBay's stocks are no longer in the Conviction Buy list of Goldman Sachs after a poor performance
EBaywas used to be known as one of the biggest online retailers in the United States. But slowly the online auction website started to lose its charm as its rivals, Amazon and Wal-Mart, started to do more business in the market. As of now, EBay stands nowhere near to the likes of Amazon and Wal-Mart and it is trying to do better. Due to all this, it is believed that the company has been removed from the Goldman Sachs’ Conviction Buy list. The investment firm decided to remove on the basis of valuation of the company’s stocks.
Ever since it separated from the 16 years long partner, PayPal, many analysts and professionals thought that the online retailer might not be able to keep up with the fast market trend and immense pressure. But EBay Inc. should be given credit as it has done quite well which no one thought it could do so. However, according to the Goldman Sachs’ valuation, the stocks are not now on the Conviction Buy list. The company also sold its enterprise unit as it spun off its payment subsidiary a few months ago.
According to a source, “The sell-side firm has further made an upside revision in price target from $30 to $33 as it expects the company to adopt a highly focused strategy after its recent spinoff. Analysts at Goldman Sachs believe that the online retailer has significant upside in the coming quarter, mainly due to increased investment in the technology.”
EBay is currently doing well in the market considering the phase it is in but not well if compared to its usual standards. The CEO of the company, Devin Wenig, stated that the company will take some time in order to reposition its business and adjust accordingly to do well in the market. He was recently asked about the company’s performance and EBay stocks performance and he mentioned that the spinning off aftermath is taking a little bit of time but it will soon get back on track.
Mr. Devin Wenig further mentioned and highlighted other services that the company is currently offering such as EBay Plus. EBay Plus was launched as a trial program only in Germany for the time being in order to see the response.
Goldman Sachs has currently downgraded the stocks but has further mentioned that the future is bright for the company in the market. The analysts are confident and have highlighted the attractive risk/reward profile of EBay.
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