Analysts bullish on eBay's marketplaces unit

Thu Jan 20, 2011 8:52am EST

* At least five brokerages raise price targets

* Say bullish on gross merchandise volume

Jan 20 (Reuters) - eBay Inc's (EBAY.O) strong 2011 forecast indicates signs of progress in its marketplaces unit, analysts said, and raised their price targets on the company's stock.

The company, which also owns fast-growing Web payments unit PayPal, reported better-than-expected fourth-quarter results on Wednesday. [ID:nN19191732] "Consistent with our view, the results showed healthy revenue growth at PayPal, augmented by operating leverage, and signs of progress in Marketplace," Credit Suisse analyst Spencer Wang said in a note to clients.

At least five brokerage firms raised their price targets on eBay on strong results and outlook.

The analysts were bullish on the company's gross merchandise volume (GMV), a closely watched measure of the total value of goods sold, which rose 6 percent.

If the average selling price improves or stabilizes, GMV in U.S, which is below the over all GMV could see a lift, BofA Merrill Lynch analysts said in a note.

However, J.P. Morgan analyst Imran Khan said the tepid GMV growth in the U.S. market shows eBay is still underperforming the broader eCommerce market.

Following are the price target changes on Ebay on Thursday:

BROKER PRICE TARGET (New) PRICE TARGET (OLD)

UBS $35 $34

JP Morgan $32 $25

BofA Merrill $34 $32

Credit Suisse $34 $32

Susquehanna $36 $31

(Reporting by NR Sethuraman in Bangalore; Editing by Vyas Mohan)

((nallur.sethuraman@thomsonreuters.com; within U.S. +1 646 223 8780; outside U.S. +91 80 4135 5800; Reuters Messaging: nallur.sethuraman@thomsonreuters.com@reuters.net)) Keywords: EBAY/RESEARCH CREDIT SUISSE

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