AmTech counts eBay (EBAY) listings and reports good news: They’re accelerating in Q2. AmTech still lukewarm on stock because of FOREX, price, and ability to exceed estimates. If the listings trends are accurate, we expect the market will overlook at least the first two concerns–but obviously the company has to beat expectations.
EBAY (NEUTRAL): Seven weeks into the June quarter, total listings are tracking up 27% Y/Y and 10% sequentially. We extrapolate total 2Q08 listings of 710MM, up 27% Y/Y, an acceleration vs. 12% in 1Q08.
Asia/Pacific listings are up 27% Y/Y, Europe is up 35%, and North America is up 20%. Given the fact that EBAY’s non-U.S. geographies are growing faster — and in light of our belief that the lows for the USD are already in place – we are incrementally cautious vis-à-vis EBAY’s ability to generate substantial upside to Street estimates.
This caution is, of course, at least partially offset by the fact that listings growth has accelerated so materially QTD.
We continue to believe that acceleration in Y/Y GMV growth is a prerequisite to material multiple expansion from current levels. We are inclined to be more constructive on the shares at or below a 2008 P/E of 17x (a PEG of 1.0 vs. our 2008-2011 EPS CAGR estimate of 17%), which implies a price of $29.75.