Friday, October 19, 2007

eBay (eBay Inc...): Buy Victoriously

So I always short when a stock shoots up undeservedly. I remember about 4 months ago when Yahoo! shot up from 27 to 33 in day on rumors of a bogus Microsoft buyout rumor. Short city.

In turn, I always buy when a stock gets pummeled undeservedly. eBay after 3 months of monster earnings and a clear beat this recent Q3. has dropped from 44 in after hours to 36.5!!? Are you freaking kidding me! It's not deserved.

If you are smart. I'd buy in at the nice $36 price and keep on buying down because I believe by Christmas, we're looking at $50.

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UPDATE TO BLOG (Since my post this morning)


RECENT NEWS:

S&P UPGRADES OPINION ON EBAY INC. SHARES TO STRONG BUY FROM BUY, ON VALUATION
EBAY; $36.9

"After Wednesday close, eBay posted third quarter results better than we projected. Management raised forward guidance, and we increased our estimates. After rising to nearly $44 in after-hours trading following Wednesday's results, the stock has fallen more than 16%. We now see it as compelling value at 21X our 2008 EPS view, a discount to peers and to the 3-year EPS growth rate we see at 33% and well under our $50 target price. We believe the marketplaces segment is healthy and will benefit from increasing advertising activity, PayPal will continue to expand rapidly, and Skype will be better managed. /S. Kessler"

eBay Slide Brings Bargain
By Vishesh Kumar, TheStreet.com Senior Writer
"We expect the stock to benefit post any potential knee-jerk skepticism on fee changes or started 2008 swing factors given that ultimately Street estimates are going higher and that there is potential for multiple expansion due to the GMV acceleration in 3Q and the potential for GMV and listings to accelerate in 4Q2007."

With so many positive developments, this short-term selloff could present an attractive chance to buy.

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Boo-yah.