It's a pickle.
Seems hard-to-please eBay investors are pushing the "Sell It Now" button despite the company's top and bottomline beats for its fourth quarter.
The company reported 44 cents a share versus the 40 cents consensus, on $2.37 billion in revenue, when analysts were looking for something closer to $2.28 billion.
Almost across the company's entire balance sheet do the numbers look good. All of them except a glaring miss in Gross Merchandise Volume. Consensus, at least to me, seemed very high given the recent trends at the company. The Street was looking for something around $15.7 billion; Citi for one was just over $13 billion. eBay reported $14.2 billion, which still seems rather robust.
Elsewhere, the company's payments division, home to PayPal, did exceptionally well, coming in at $795 million. Consensus here was $772 million. Active User Growth increased 3 percent, essentially in line with expectations, though Citi's Mark Mahaney had said anything over 4 percent would be considered "positive."
The company's Marketplaces metric reached $1.5 billion versus the $1.43 expected.
Looking ahead to the company's first fiscal quarter, eBay offers an EPS range of 39 cents to 41 cents. The Street was at 39 cents, on a revenue range of $2.1 billion to $2.2 billion, with the Street at $2.144 billion. For the full year, eBay anticipates $1.63 to $1.68 on $8.8 billion to $9.1 billion in revenue
For those looking for a beat-and-raise kind of quarter, they got half their wish, and they might account for eBay extending its 4-percent day-of-trading losses into the after-market. But on many levels, the to continued retreat doesn't make a lot of sense. The company is coming off its seasonally best quarter and is trying to manage expectations into the traditionally slow first quarter. It's a tried and true strategy the company has employed before. Depending on the broader downdrafts that torpedoed broader tech today, and how long that trend continues, I have to believe that eBay, and Intel and IBM before it, will stage a comeback as investors — not traders, but investors — get a chance to digest this data.
As I wrote earlier, this company's turnaround strategy has evolved from merely the implementation stage to the paying-of-dividend stage. One quarter does not a turnaround make. But when you consider the third quarter, and now the fourth quarter, and see this company's guidance into the first quarter, it seems eBay is on its way, whether this snapshot of share-price reaction to the numbers tonight reflect it or not. If your horizon is longer than a few hours, eBay, based on the numbers tonight, seems well worthy of a second look.
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