Sentiment Positive Ahead of eBay Earnings 9 comments
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eBay (EBAY) is scheduled to release Q2 earnings this Wednesday, July 22, after the market close. Average analyst estimates for the online marketplace are $.36/share in EPS and $1.99 billion in revenue. Twenty-four analysts track the stock with five upward EPS revisions in the last 30 days and no downward EPS revisions in the last 30 days.
I always find this a tough period waiting to see if the company is going meet, exceed, or miss their earnings estimates. One thing I have discovered of value is to analyze sentiment moves in a stock ahead of the company’s earnings release.
In the case of eBay, I will use the Piqqem sentiment index for EBAY to see how sentiment has changed in the last quarter, for the months within that quarter, and from the end of the reporting quarter thru today.
I’m looking for moves or changes that may foreshadow the earning release. (Piqqem leverages the ‘wisdom of crowds’ by allowing its users to vote on the price directions of stock and then applies its own propriety factors to calculate sentiment for a security. In their model, 0 is the lowest and 4 is the highest sentiment.)
Sentiment for eBay
Source: Piqqem
The above chart shows a 17% increase in Ebay’s sentiment from the end of Q1 through July 20, 2009, with a steady increase for each period within the quarter, and a slight move downward of about 3% from the close of the second quarter thru July 20, 2009.
On the Piqqem scale, a sentiment rating of 2.62 is considered good.
Only eBay knows their actual results, but their current sentiment points to eBay meeting or exceeding earnings expectations on Wednesday.
Disclosure: No positions
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Once the banks catch on to how this check out cash cow works -- and with the economy in such flux it SHOULDN'T be long now -- this clunker becomes lead dead in the water and WATCH how fast it sinks!
But with raised fees, new rules, sellers leaving and the huge influx of chinese made junk jewelry, "as seen on Tv" merch and 100's if not 1000's of the exact same overstock item that no one would buy when it was marked down at the big box retailer, ebay has lost it's shine.
I no longer shop there because I rarely find whatever IT is I want. Ebay has successfully improved themselves to death. They're not a flea market, they're boring, sanitized for our protection.
Ebay is the internet equivalent of cream cheese and mayo on white with the crusts cut off. Yawn!
Many sellers refuse to fall into the fee trap by rolling shipping costs into selling price and offering ''free shipping''. I say trap, because eBay has pushed "free shipping" in an effort to collect higher Final Value Fees on the cost of shipping.
Donahoe & Co are now so desperate to raise revenue they plan to force sellers to roll insurance into selling price, thus assuring the company a fee hit on those proceeds as well.
The move to have sellers process shipping through eBay is another slick Donahoe diversion.
PayPal revenue is growing due to off eBay sales. As Donahoe has failed to increase revenue by increasing sales he will increase revenue for eBay by moving the shipping feature to eBay from PayPal. This does not generate any additional revenue for the company as a whole. All it does is use the smoke and mirrors of revenue shifting to give the Board of Directors the mistaken idea that business at eBay is improving.
Increasing eBay fee revenue is the reason for the fee increase that lurks behind the bogus but essentially mandatory 5 ''free'' auction listings. This is the slick fee increase devised by Donahoe & Co where they force most sellers to pay increased Final Value Fees of 8.75% on their first 5 auction listings every month. The return is that eBay waves the small up front listing fee. Bottom line, fee increase for eBay.
Increasing revenue is why promotions such as offer ''free shipping'' and get the subtitle free are offered as again eBay profits.
How much more chicanery, smoke & mirrors will the eBay board accept before they end this madness and let Donahoe & Co take their golden parachutes?
What will the next Donahoe flim-flam be?
Perhaps another diversion...maybe he will elect to announce a reduction in PayPal fees for eBay transactions, while simultaneously increasing fees at eBay to make it appear he has done the job he was hired to do?
Under Donahoe & Co's leadership:
* Unique visitors to eBay have steadily declined; Amazon has increased.
* Page views on eBay have steadily declined; Amazon has increased
* Sales at eBay have steadily declined; Amazon has increased.
* eBay is alienating small sellers; Amazon is opening it's doors to more small sellers.
* Buyers looking for a safe and trustworthy transaction are flocking to Amazon, not eBay.
Remind me again, which company does John Donahoe work for?
His office is in San Jose, but the success of his efforts seem to benefit the competition in every meaningful way more than they benefit the company that pays his salary.
There is an explosion of theft and fraud on ebay by buyers who have learned that they can buy a laptop, a WII, nice watch, a little bling and get it all for free. They simply file a claim with PayPal that the item is Significantly Not As Described. PayPal tells the buyer to send the item back to the seller with Postal Service Delivery Confirmation. The buyer sends an empty envelope, an empty box, maybe a brick to the seller using Delivery Confirmation. The buyer then gets a refund from PayPal and gets to keep the seller's item. When PayPal is informed by the seller of the arrival of an empty box, they tell the seller to get a "police report". Problem is, police departments will not take police reports for online theft.
The buyer who now has the seller's item and money must have "positive sentiments" about ebay.
I suggest that you spend 6 months or so selling high dollar items on ebay. Let's see if you have "positive sentiments" for ebay after losing a few expensive items to the new pack of thieves roving ebay, supported by ebay and paypal's policies and procedures.
Sell 100 or so expensive items a month in ebay's jewelry and electronics categories for 6 months. I dare you. I'd love to read about your sentiments when you're done selling on ebay, as are so many honest former ebay sellers.
I think there are some Steve Madden Shoes at the nearby thrift store, for $5. You don't have to pay for shipping, and they still have tags on them. LOL! How is that for sentiment?
Where is Jeetil Patel? His sentiment is always accurate. Unlike the paid Ebay stock flunkies.
“Noise” Donahoe and some market analysts seem to believe that PayPal’s manning of the pumps will keep the good ship “eBay” afloat. I certainly would not put my money on the “clunky” PayPal for the long term. Assuming that the parties don’t already have some agreement to not compete, I have no doubt that eventually those other well known “loan sharks”, the major credit card companies, will get off their butts and introduce a similar universal card/terminal-less on-line payments system that the participating banks can incorporate into their internet banking systems—and [i]they[/i], at least, will do it properly—and that, my friends, will undoubtedly be the end of PayPal outside of the Donahoe-dwarfed eBay marketplace ...
I won’t get going on PayPal any further other than to recall that Donahoe has been quoted as saying that the door is slightly ajar for a potential spinoff of his company’s online payments unit. If this is correct it will be the first logical thought that this guy has ever had; he otherwise clearly has no idea of what he is doing at eBay. If that MBA taught him anything then he should be using all his skills to negotiate with the banks to take PayPal and integrate it into their online payments system—in exchange for an appropriate interest in the consolidated business, of course. Because, the more successful PayPal is, the more likely it is that the banks will finally get off their butts and introduce a like system; if and when that happens the banks will do it properly and will exterminate PayPal for being the irritating “insect” that it is.
On Jul 22 01:33 AM o.c.d.collectibles wrote:
> Let us not forget that TaoBao (online auctions) has completely blown
> ebay off the map in China. It won't be long, news travels fast to
> the states. TaoBao is working on ways to adapt to English speaking
> countries..as we speak!!LOL!!
Then, AFTER the report, the "you know what" hits the fan.
Such as..policy changes..hit or miss..first, they announce them before they are actually submitted...to see how they are received by the public..they wait in earnest...they think they are going to con people in to believing the hype, but of course, it just doesn't fly any more. besides, Auctionbytes does a major survey of millions of sellers who NOW sell elsewhere on "everyplaceisell" an aggregate of now ex-ebay sellers who like to sit back and watch the story and stock unfold.
THEN..we find out that Ebay forgot to purchase the software that went with SKYPE. The very important fact they decided to leave out when they announced they were going to sell SKYPE. They waited to tell the stockholders that they can't sell or use skype without it. Yep. We call that VERO on Ebay. They used to pull our listings off if someone claimed we abused intellectual rights in some way, (even if we did not, and someone was abusing a vero account card)
Lets see. Are we all together on this one now? Are we going to look for moves or changes BEFORE the next Q3 report that will somehow foreshadow the next report, or are we going to rely on what ebay's grids and margins are?
You guys are perfectly welcome to come and read the auctionbytes blogs. It is not comprised of a handful of ungrateful uneducated ex-ebay sellers. Many of us are older professional antique dealers who have gone elsewhere, some are just part time sellers who have professional careers elsewhere and are now unable to sell on ebay due to the obstructive nature of their policies. It's sour grapes yes! It's also ebay's past and future! We are the community who started and made ebay what it once was. We are who brought ebay down, because we LEFT. Remember that. We still like to come back and visit.