Analysts Talk Up EBay Strategy, Technology
EBay Inc.’s battered stock led Nasdaq gainers Tuesday, one day after the company briefed analysts on its growth strategy and appeared to reassure investors that it is dedicated to preventing the system crashes that have plagued its site.
The online auctioneer also beefed up its technology staff Monday, naming Maynard Webb from Gateway Inc. president of technologies and making other key appointments.
The stock soared $9.63 to $89.25, leading other Net names higher. The stock fell as low as $79 Tuesday before rebounding. It is still off 62% from its record high of $234.
Monday’s meeting seemed to reassure analysts about EBay’s ability to adjust to its rapid growth, after a prolonged site outage over the weekend.
DB Alex. Brown analyst Shaun Andrikopoulos repeated his “buy” rating on the stock after the meeting and maintained a 12-month price target of $150 a share.
“We were impressed with EBay’s growing team of professionals dedicated to maintaining and ‘re-architecting’ its systems infrastructure over the next several years,” Andrikopoulos said in a research report.
Analysts at Goldman Sachs, DLJ Securities and Morgan Stanley Dean Witter also reiterated their favorable ratings on the stock.
Analysts said EBay may start offering automobiles on its Web site to widen the variety of products it sells and attract more customers.
EBay’s purchase in May of closely held Kruse International, an auctioneer of collectible cars, will enable it to sell new, used and rare automobiles.
EBay also told analysts it will introduce by year’s end a “Great Collections” auction, featuring items priced between $250 and $10,000. In addition, it will expand its regional auctions into 50 cities, including New York, Atlanta and Chicago, from just Los Angeles now, analysts said.
