Please ensure Javascript is enabled for purposes of website accessibility

eBay Shares Jump 11% on Strong Holiday-Quarter Results

By Anders Bylund - Feb 4, 2021 at 8:18AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The growth story is playing out in international markets, supported by a more robust technology platform.

Online commerce veteran eBay (EBAY -0.71%) reported fourth-quarter results after the closing bell on Wednesday, Feb. 3. The company beat Wall Street's estimates across the board and eBay's stock gained 11% in the after-hours trading session.

By the numbers

eBay's fourth-quarter sales rose 28% year over year to $2.9 billion. Adjusted earnings landed at $0.86 per diluted share, up from $0.66 per diluted share in the year-ago period. The analyst consensus pointed to earnings near $0.83 per share on revenue in the neighborhood of $2.7 billion.

The company managed transactions worth a cool $100 billion of gross merchandise volume in fiscal year 2020, a 17% year-over-year increase. The number of active buyers rose by 7% to 185 million active accounts.

A young couple lying on the floor, using a laptop and a credit card.

Image source: Getty Images.

Looking ahead to the first quarter of fiscal year 2021, eBay expects revenue to grow by approximately 36% year over year to $2.96 billion. Adjusted earnings should stop near $1.06 per share, 38% above the result in the first quarter of 2020. Here, the average Street projection points to earnings of roughly $0.86 per share on sales in the vicinity of $2.53 billion.

The story behind the numbers

eBay's results reflected strong growth in international transaction volumes.

"In the US, one in 10 online shoppers bought something on eBay," eBay CEO Jamie Iannone said in the earnings call. "In Germany that number was one in seven and in the UK it was one in four."

The business growth was also remarkably steady. More than 100 days in 2020 saw transaction volumes exceeding the peak traffic of fiscal year 2019, and the e-commerce platform managed this heavy traffic while also delivering the highest availability of the last six years.

The stock has now gained 72% in 52 weeks, and is trading at just 17 times forward earnings.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

eBay Inc. Stock Quote
eBay Inc.
$44.62 (-0.71%) $0.32

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/20/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.