Earnings Preview: eBay Set To Report Wednesday

| About: eBay Inc. (EBAY)

eBay Inc. (NASDAQ:EBAY) is scheduled to release last fiscal quarter's results after the closing bell on January 18, 2012.

eBay Inc. provides online marketplaces for the sale of goods and services, as well as other online commerce, platforms, and online payment solutions to individuals and businesses in the United States and internationally. The company was founded in 1995 and is headquartered in San Jose, California. EBAY trades an average of 9.3 million shares per day.

52 Week High: $35.35
52 Week Low: $26.86
Book Value: $12.53
Float Short: 1.12%

Analysts are expecting an improvement of $0.09 in earnings per share compared to last quarter's results of $0.48. Investors will be looking to see a number north of $0.57 per share, based on the earnings estimates. Analyst estimates range between $0.48 and $1.44 per share.

The current trailing twelve months P/E ratio is 18.9. The forward P/E ratio is 15.82. eBay recently tested the 200-day moving average, but has since broke down below again. All the moving averages are simply trending sideways, providing almost no trend direction guidance. eBay better not disappoint in this environment with the current PE, or it may get ugly.

With the current type of breakdown failure of the 200MA test, I would be looking to buy portfolio insurance with options before the release if I owned shares. This can be done with selling calls against the shares you have and/or buying puts.

Investors have been rewarded with an increase of year-over-year revenue. Revenue reported was $9.16 billion for 2010 vs. $8.73 billion for 2009. The bottom line has falling earnings year-over-year of $1.80 billion for 2010 vs. $2.39 billion for 2009.The company's earnings before interest and taxes are rising, with an EBIT year-over-year of $2.05 billion for 2010 vs. $1.46 billion for 2009.

Here is a look at the fiscal year revenue:

paid2trade.com revenue gross bar chart for EBAY

Gross reported revenue compared to the mean estimate (rounded):

Fiscal Quarter Ending Month-Year Revenue Estimates Actual $ Difference Difference %
Sep-11 $ 2.91 B $ 2.97 B $ 55.22 M 1.9%
Jun-11 $ 2.61 B $ 2.76 B $ 152.36 M 5.84%
Mar-11 $ 2.48 B $ 2.55 B $ 62.98 M 2.54%
Dec-10 $ 2.49 B $ 2.50 B $ 7.24 M 0.29%
Sep-10 $ 2.18 B $ 2.25 B $ 69.44 M 3.19%

M = millions, B = billions
Differences are rounded.
Some onetime items are often excluded in reported EPS.

paid2trade.com Quarterly Estimates And Actual EPS results EBAY Reported earnings per share compared to the mean estimate. Differences are rounded.

The total short interest number of shares for EBAY:

paid2trade.com short interest tool. The total short interest number of shares for EBAY

The number of days to cover short interest based on average daily trading volume for EBAY:

paid2trade.com number of days to cover short interest based on average daily trading volume for EBAY

I use a proprietary blend of technical analysis, financial crowd behavior, and fundamentals in my short-term trades, and while not totally the same in longer swing trades to investments, the concepts used are similar. You may want to use this article as a starting point of your own research with your financial planner. I use Seeking Alpha, Edgar Online, and Yahoo Finance for most of my data. I use the confirmed symbols from earnings.com that I believe to be of the most interest.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.