Monday, April 4, 2016

eBay's Turnaround

Changing Perspective To Finally Focus On SEO Can Meaningfully Turn eBay.
Management Focused On Raising Returns.
Earnings Upside Potential Near Term If Topline Re-accelates.

eBay (NASDAQ:EBAY) is about to initiate a major turnaround with a simple reclassification of its purpose. Turnarounds are usually associated with complicated adjustments. Here we think it is as simple as a shift in viewpoint.
Historically eBay focused on listings and now by adjusting its perspective to fit listings into key product categories they are about to finally align with Google and the rest of the internet and correct its main reason for its decline.
eBay identified the SEO issue as the main reason for the company's weakness and its fix should re-accelerate its active users (the company's key metric measuring the number of people who actually did something recently). The change is basic but can, potentially immediately, re-accelerate revenue growth. If topline re-accelerates, earnings will re-accelerate thanks to 20-30% margins that should move back up with faster topline.
We think this is the type of turnaround situation that we look back on and say 'that was easy enough.'
eBay does not have any serious operational issues. The need to show up in Google searches is forcing eBay to make the change.
To see the rest of the report click here.

#in, $EBAY
Chaim Siegel has been working with hedge funds and mutual funds as an analyst and PM his entire career. Chaim specializes in earnings and predicts, analyzes and reacts to earnings and earnings events as well as developing current company stories with a hedge fund perspective. If you want his analysis real time sign up to the right for real time email alerts. Disclosure: These trades can lose you money and principle especially when using leverage BY USING THIS SITE YOU AGREE TO TAKE ALL RESPONSIBILITY FOR YOUR OUTCOMES AND LOSSES AND HOLD BESTIDEAS, ITS CONTRIBUTORS AND ELAZAR ADVISORS, LLC HARMLESS

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