eBay was set to report earnings on Wednesday after the market close, with investors watching to see whether the online marketplace can extend the momentum that lifted its last quarter. The stock traded at $100.80, just above an average analyst price target of $100.40.
The company enters the update after posting $2.97 billion in revenue in the previous quarter, up 15% from a year earlier, with 135 million active buyers. It also beat Wall Street's revenue expectations and guided next-quarter revenue and earnings per share above estimates, a sign that eBay stock has been supported by a business that usually lands close to forecast. Analysts expect current-quarter revenue to rise 17.5% year on year, a sharper pace than the 1.1% increase seen in the same period last year.
That outlook matters because the market has not been generous to consumer internet names that have already reported. Coursera, which posted 9.1% revenue growth and matched estimates, fell 11.6% after its results. Netflix, which reported revenue up 16.2% and beat estimates by 0.5%, dropped 9.7% after its release. By contrast, shares in the broader consumer internet segment were up 17.9% on average over the last month, while eBay gained 14.5% over the same stretch.
The backdrop gives eBay little room to disappoint. The majority of analysts covering the company reconfirmed their estimates over the last 30 days, and eBay rarely misses Wall Street's revenue estimates. That combination leaves Wednesday's report likely to hinge less on whether the company can clear a low bar and more on whether it can show the kind of growth investors have already begun to price in.
If eBay delivers another clean beat and firm guidance, the stock has room to hold near current levels or push higher. If it falls short, the gap between the current share price and the analyst target may matter less than the question of how much of the recent rally was built on already-accepted expectations.