eBay Inc. first quarter fiscal year 2015 Earnings Preview by Cantor Fitzgerald

Cantor Fitzgerald expects eBay Inc. to report in-line first-quarter results, while reiterating a Buy rating on the stock.

On Monday in a research note, Cantor Fitzgerald restates its rating of Buy on the stock of eBay with a price target of $60. The sell side company supposes the company to post its first quarter financial results as per the Street’s estimation. The e-commerce giant is all set to report its 1QFY15 earnings on Wednesday APRIL 22^nd after market close.

Youssef Squali an analyst at Cantor Fitzgerald mentioned we expect 1Q:15 results to come in line with muted Street expectations given the maturing auction business.” He thinks that the exchange rate volatility will put substantial pressure on the quarter earnings, and the currency impact is likely to continue towards the next quarter as well.

Cantor Fitzgerald expects the company to post around $4.39 billion of revenue somewhat less than the $4.43 consensus estimate in the first quarter. The research firm believes company’s earnings per share to be in line with consensus estimate of 70 cents. The sell-side firm said, “We expect revenue growth to dip ~560 bps Q/Q to 3% Y/Y, largely reflecting F/X headwinds and continued underperformance of Marketplaces.”

Mr. Squali decreased his EPS estimate for fiscal year 2015 to $3.09 from $3.26 less than consensus forecast of $3.10, mainly due to currency headwinds. He believes that eBay will report $3.41 EPS in FY2016 more than consensus projection of $3.39.

Furthermore, Cantor is optimistic that the spinoff of its payments unit PayPal will unlock great value for the e commerce company. The firm supposes eBay to release robust 2^nd quarter guidance, and update the whole year future guidance including the spinoff of PayPal. EBay is all set to finish the spinoff later this year.

The management of EBay Inc. expects 1QFY15 revenue to be in the range of $4.35 to $4.45 billion down by 10.6% from previous quarter slightly less than $4.61 billion of Zacks estimate.

As per the analysts polled by Bloomberg, 23 assigned a rating of Buy with 21 hold ratings, however only four have rated the stock of eBay as Sell. The twelve month consensus price target on the company stock is $54.64 which reflects 6.9% of upward potential compared to current stock price.

EBay stock is up by 0.50% and trading at $56.07. The e-commerce has market capitalization of $67.65 billion.

EBay has different plans prior to Christmas

EBay is one of the biggest retail store chains in the United States. It has been doing a great business over the years but the company has fall behind Wal-Mart and Amazon in recent times. Despite of struggling a lot to revive its business, the company has various plans for its future. Hence in order to revive its business like old times, the company has different plans and has planned its road to Christmas. The company is an online retailer which is planning to expand with bricks and mortar stores.

Online shopping platform EBay has converged with its offline retail peers by opening pop up stores to offer instant shopping to beat the Christmas rush and ensure delivery before the crucial date of December 24. According to Australian news, EBay has launched its first Australian interactive store on the forecourt of Customs House, Sydney for the next four days. It is not only EBay which is planning to do this but another online shopping platform Groupon will join hands too.

Sydney Morning Herald’s journalist Carolyn Cummins reported that “Groupon has taken a short term lease of the former golf range store in Elizabeth Street to offer customers the option to buy in-store and collect instantly, or buy online and pick up at a time convenient to them.” The stores of both companies will beoffering block buster deals and more than 20 products offers of up to 70 percent off. There will be an option to increase the selection to 30 products in the lead-up to Christmas Eve.

The spokesperson of EBay Company believes that this will be beneficial for the company and it is a good initiative taken. According to EBay’s in house survey, it is believed that Sunday will be the busiest shopping day for the year, with estimates six items will be purchased online every six seconds, based on previous year sales, forward orders and eBay's own traffic trends.

According to her, “This is the future of shopping – bringing the world of online, offline, and creating a seamless shopping experience for people to browse items in the windows, then shop them directly from their mobile.”

EBay believes smart stores are the future of shopping

EBay is one of the biggest retail store chains in the United States. It has been doing a great business over the years but the company has fall behind Wal-Mart (WMT) and Amazon in recent times. The verge reported that “Over the last year eBay’s brand has struggled a bit. It was hit with a massive security breach and announced that it was spinning out PayPal, a divorce precipitated by the overwhelming investor sentiment that eBay was holding PayPal back. Still, the company has shown steady growth and profit, giving it the breathing room it needs to try and reinvent itself.”

Despite of struggling a lot to revive its business, the company has various plans for its future. The company’s new smart stores are the future of shopping. It includes magic mirrors, massive touchscreens, and dressing rooms that know what you need next. The newest adventure of the company is to reinvent itself in which a partnership with the designer Rebecca Minkoff for a new "smart stores" in New York and San Francisco will take place.

The company officials explain the mechanism of these smart stores as “Walking into the store, shoppers are greeted with massive mirrors that double as touchscreens. They can browse the aisles the old-fashioned way, or swipe through the store’s inventory. Rather than lugging an armful of clothes to the dressing room, you simply tap the items you want to try on. When everything is ready to try on, you get a text alert. Oh, and feel free to order a drink while you’re at it.”

The smart stores will totally help you in selecting different outfits as well as lets you select the mood and adjust the lightning to see how certain dressings will look in different settings.