Online marketplace provider eBay Inc. (NASDAQ: EBAY) is gearing up to release its 4Q21 results on February 23. Ahead of the print, we wanted to try a different approach to see how the company might have fared in Q4. For this, we used TipRanks’ new tool that measures and analyzes a company’s website visits over a specified time period.
Clearly, being an e-commerce player, around 90% of eBay’s revenue comes from the purchases made on its online platform. Now, the more the flow of visits to the website, the higher is the prospect of sales. Therefore, the company is highly dependent on its website’s popularity for revenues.
Interestingly, looking at the Q4 statistics for website visits, we found that there has been a 1.19% rise in total estimated visits to the eBay website globally on a quarter-over-quarter basis. The holiday season may have contributed to this growth in virtual footfall during the quarter. There is a good chance that this sequential growth in user visits has translated into revenues to some extent.
Notably, eBay is putting relentless efforts in enhancing seller as well as buyer experience. New strategies that attract potential buyers back to the site, after they have left the site with or without making a purchase, also may have driven the sequential uptick in user visits in Q4.
Digging deeper, we noticed that there has been a year-over-year decline in total estimated global visits to the eBay platform by 16.72%. This year-over-year downtrend might have been the momentum that has continued from the third quarter. Incidentally, the third quarter website visit stats also showed us a 12% year-over-year decline. Later in the Q3 print, this decline was corroborated by a 5% year-over-year decline in active buyers in Q3.
Thus, it remains to be seen to what extent the year-over-year decline in website visits have impacted the top-line in Q4, and how far the company has achieved its 3-5% year-over-year revenue growth estimate.
Wall Street analysts also seem to be a little cautious in their optimism for the EBAY stock, ahead of its Q4 print.
Last week, UBS analyst Kunal Madhukar reiterated a Buy rating on the stock but slashed the price to $72 from $80.
Overall, the stock has a Moderate Buy consensus rating based on 5 Buys and 6 Holds. The eBay stock predictions indicate an average price target of $76.36.
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