NEW YORK (TheStreet) -- As eBay prepares to report its fourth-quarter earnings, analysts are lowering their expectations as a response to the currency and economic chaos in Europe. Pacific Crest's Chad Bartley expects the euro, pound, and yen to fall 14%, 9%, and 17% respectively during the first half of 2015. With recent turmoil surrounding central bank decisions such as the recent unexpected move from the Swiss Central Bank, and analysts are lowering forecasts all around. Must Read: Complain About Amazon but Online Retail Had a Great Holiday Season During a conference call after third-quarter earnings, eBay CEO John Donahoe admitted that "without a doubt, eBay is clearly facing some near-term challenges." He said that growth from Marketplaces "is neither what we wanted nor what we expected" and that eBay would be adding marketing spending towards that unit. According to eBay, revenue growth from the Marketplace unit fell to 6% in the third quarter, compared to 9% in the second quarter and 12% in the third quarter of the previous year. Nonetheless, eBay is still expected to post revenue growth despite the international troubles. According to Thomson Reuters, analysts foresee a fourth-quarter revenue of $4.93 billion with 89 cents earnings per share. This would be up from eBay's third-quarter, when it earned 68 cents a share on revenue of $4.35 billion. Also of interest to eBay followers is the recent decision to spin off PayPal. Analysts are split on how this move will impact eBay's numbers since the digital payments space is crowded and messy. However, they agree that the spin-off only furthers eBay's core focus of marketplaces. Tomorrow's report will likely address these issues and signal how eBay is managing with the PayPal spinoff. Shares of eBay were falling in mid-Tuesday trading, losing 0.89% to $53.18. Here's what analysts said about eBay: Daniel L. Kurnos, Benchmark (Buy, $64 PT) Shares have come off recent highs as estimates continue to be revised downward given the ongoing currency and economic headwinds in Europe. We are trimming our own forecast a bit further given the recent developments, coming in just above consensus on a consolidated basis for 2015, which we believe now reflects a fairly conservative outlook for the Marketplaces business. However, we still believe there is intrinsic upside to the current share price given the pending PayPal spin, with our sum of the parts analysis yielding a consolidated value of $64 per share even ascribing a discounted multiple of 11x to the Marketplaces unit. Greg Munster, PiperJaffray (Neutral, $55 PT) Looking at the FX impact in CY15 & CY16, we are lowering our revenue outlooks by ~3.5% and our EPS estimate by 2% in CY15E and 3.5% in CY16E. We believe that Street revenue numbers are ~3% too high, noting that the 2015 outlook has not decreased materially since management gave guidance on 10/15 despite a negative shift in the Pound and Euro (eBay's two largest international currencies). We remain Neutral on shares of EBAY as we believe that the company continues to struggle with mobile payment traction, that there is a low chance that PayPal will be bought before the spinoff, and that the spin itself will be difficult as investors are increasingly uneasy about the payments landscape. Youssef Squali, Cantor Fitzgerald (Buy, $60 PT) We expect 4Q:14 results to come in line with muted Street expectations given the maturing auction business, last year's security breach and F/X headwinds, all of which should negatively impact Marketplaces growth. Continued strength in the US$ relative to major currencies so far in 1Q:15 is likely to yield tepid 1Q:15 guidance as well, in our opinion. We see the spin-out of PayPal and potential for strategic partnerships and for improvement in Marketplaces as reasons to continue to own the stock. Must Read: eBay's Paypal IPO Might Be the One Last Gasp for Web Auctioneer --Written by Rebecca Borison in New York >Contact by Email. Follow @borisonr // 0;if(!d.getElementById(id)){js=d.createElement(s);js.id=id;js.src="//platform.twitter.com/widgets.js";fjs.parentNode.insertBefore(js,fjs);}}(document,"script","twitter-wjs"); // ]]> TheStreet Ratings team rates EBAY INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation: "We rate EBAY INC (EBAY) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, good cash flow from operations, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had sub par growth in net income." Highlights from the analysis by TheStreet Ratings Team goes as follows: EBAY's revenue growth trails the industry average of 28.8%. Since the same quarter one year prior, revenues rose by 11.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share. EBAY INC's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, EBAY INC increased its bottom line by earning $2.18 versus $1.99 in the prior year. This year, the market expects an improvement in earnings ($2.95 versus $2.18). Net operating cash flow has slightly increased to $1,368.00 million or 2.54% when compared to the same quarter last year. Despite an increase in cash flow, EBAY INC's cash flow growth rate is still lower than the industry average growth rate of 26.48%. The gross profit margin for EBAY INC is currently very high, coming in at 75.14%. Regardless of EBAY's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 15.46% trails the industry average. Despite currently having a low debt-to-equity ratio of 0.38, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.47 is sturdy. You can view the full analysis from the report here: EBAY Ratings Report
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