eBay Stock Sees Influx of Bear Notes After Earnings

The e-commerce name issued a dismal current-quarter forecast

Digital Content Manager
May 5, 2022 at 9:27 AM
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eBay Inc (NASDAQ: EBAY) is sinking before the open, last seen down 6.8% to trade at $50.70, despite the e-commerce concern yesterday reporting better-than-expected first-quarter earnings and revenue. What's weighing on the stock instead is its disappointing current-quarter revenue forecast, as the company struggles with higher costs, a tight labor market, and supply chain challenges. Plus, eBay said the Russia-Ukraine conflict may continue impacting its traffic in key markets such as Germany and the U.K. this year.

The brokerage bunch is not taking the update lightly. EBAY has already received no less than 14 price-target cuts this morning, including one from Jefferies to $50 from $57. Analysts are already skeptical of eBay stock, with 12 of the 17 in question giving it a tepid "hold" rating.

Last time we checked on the equity, it was in a similar circumstance. The security could today snap a three-day win streak, should these losses hold. And the shares have had a rough year so far, hitting a Feb. 24, roughly annual low of $55.62, before the $61 level rejected its late-March rally. Year-to-date, eBay stock carries an 18.2% deficit.

The options pits are overwhelmingly bearish towards EBAY. Back at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock's 10-day put/call volume ratio of 2.60 sits higher than 96% of readings from the last 12 months. This means puts have been picked up at a much quicker-than-usual pace. 

What's more, the security's Schaeffer's put/call open interest ratio (SOIR) of 1.67 now stands in the 94th percentile of annual readings. In simpler terms, short-term options traders have rarely been more put-biased. 

 

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