Benchmark Reiterates Buy on eBay Ahead of 3Q13 Results Report

In a report published Tuesday, Benchmark Company analyst Daniel L. Kurnos reiterated a Buy rating and $63.00 price target on eBay (NASDAQ: EBAY).

In the report, Benchmark Company noted, “eBay (EBAY-Buy, PT $63) is set to report 3Q13 results on Wednesday after the close. Until the recent acquisition of privately-held global payments platform Braintree, shares of eBay were essentially flat for the year despite continued acceleration in user growth, reflecting macro headwinds in Europe negatively impacting Marketplaces and Payments growth. Further concerns regarding consumer sentiment given the recent US government shutdown have also likely limited share price appreciation. Despite these factors, we've seen a minimal impact on domestic ecommerce sales, with growth in 3Q likely similar to 2Q's 16% (comScore) and forecasts for the 2013 online holiday season predominantly in-line with 2012. eBay is still expected to generate 15% revenue and 16% EBITDA growth for 2013, with acceleration expected in 2014 thanks to further expansion of the Payments platform. At 10x our 2014E EV/EBITDA, we think shares are undervalued relative to the Payments opportunity including the integration of Braintree, expansion of Bill Me Later and increasing traction with the offline platform.”

eBay closed on Monday at $54.77.