© Reuters
On Wednesday, BMO Capital Markets adjusted its stock price target for eBay (NASDAQ:), increasing it to $53.00 from the previous $49.00, while maintaining a Market Perform rating for the company.
The firm credits eBay's focus category Gross Merchandise Volume (GMV) growth of 4% year over year, outperforming the overall market by 6 percentage points. Despite this, German and UK markets continue to face challenges due to broader macroeconomic factors, which have tempered overall sentiment.
BMO Capital Markets does not foresee a positive inflection in eBay's overall GMV until at least the second half of 2024. However, the company has noted an expected operating margin expansion between 60 and 100 basis points through 2024. This expansion is credits eBay's investments in improving the buyer and seller experience, as well as the introduction of general artificial intelligence tools that resonate well with users.
The revised $53 price target takes into account the cost-cutting efforts eBay has implemented. Additionally, the company's plans for a $2 billion share buyback in 2024 have been included in the new target, indicating confidence in eBay's financial strategy and the potential for value improvement for shareholders.
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