JP Morgan Upgrades eBay to Overweight

Benzinga reported on Friday morning that internet auction site eBay (NASDAQ: EBAY) was upgraded from Neutral to Overweight and the price target was increased from $39 to $50 by J.P. Morgan.

JP Morgan noted, "We are upgrading shares of eBay from Neutral to Overweight and raising our PT from $39 (year-end 2012) to $50 (year-end 2013). We recognize eBay shares have outperformed YTD, appreciating 45% vs. the S&P 500 at 9%. However, we believe there is further upside over the next several quarters as eBay becomes an increasingly important partner for retailers across all 3 segments—Marketplaces, Payments, and GSI—and continues to benefit from its strong mobile presence."

In addition, Benzinga reported Friday morning that eBay is updating its third quarter and full year 2012 earnings per diluted share guidance to account for the expected impact of its $3 billion debt offering, which priced earlier today. Closing of the offering is scheduled for July 24, 2012 and is subject to customary closing conditions.

“As we disclosed in our earnings release yesterday, we have been evaluating sources of additional liquidity even though we believe that our strong balance sheet and free cash flow will allow us to finance our organic needs and stock repurchase programs over the near to medium term. We also do not anticipate meaningful mergers and acquisitions activity in the near term,” said eBay Inc. Chief Financial Officer Bob Swan. “In light of the low interest rate environment, we felt that conditions were right and decided to opportunistically enter the market.”

While the internet war has been ongoing between the likes of Facebook (NASDAQ: FB), Google (NASDAQ: GOOG) and Amazon (NASDAQ: AMZN), eBay has successfully managed to retain its own little auction corner of the web. Other auction sites have sprung up from time to time, but none have the longevity that eBay continues to display. It has not tried to become anything other than an auction site by standing its ground and remaining successful.

On Friday eBay traded at about $44, up roughly 0.4 percent.

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