Goldman Sachs Upgrades eBay After Strong Fourth-Quarter Results
Goldman Sachs upgraded eBay to Neutral following what it described as a strong fourth-quarter earnings report.
According to analyst Eric Sheridan, eBay delivered better-than-expected results across key metrics. Gross merchandise volume (GMV), revenue, and non-GAAP earnings all exceeded forecasts, supported by solid performance in focus categories and continued strength in the U.S. market.
Growth Investments Begin to Deliver Results
Sheridan noted that management emphasized how earlier strategic investments are now positioning eBay for durable long-term growth.
These efforts are translating into improving operating momentum, with positive trends expected to continue into 2026.
Goldman Sachs also highlighted eBay’s ongoing initiatives to enhance platform capabilities and expand product offerings. The company is increasing its presence in faster-growing verticals, including collectibles and fashion, which are contributing meaningfully to overall growth.
Revenue Outlook and Shareholder Returns Improve
The firm now expects sustained revenue growth over the next 12 to 18 months. This outlook is supported by stable profit margins and consistent capital returns to shareholders.
As part of its shareholder-friendly strategy, eBay announced a new $2 billion share repurchase authorization.
Based on the improved outlook, Goldman Sachs raised its 12-month price target on eBay shares to $88, up from $77.
Strength in U.S. GMV Offsets International Weakness
On the positive side, U.S. GMV exceeded expectations, with emerging growth areas such as live commerce and vehicle sales contributing to performance.
Focus categories grew 16% year over year, while cost discipline supported stronger earnings guidance.
However, international GMV faced pressure due to macroeconomic weakness in Europe. Additionally, trading-card sales growth slowed, a trend management expects to continue through 2026.
Depop Acquisition to Support Long-Term Strategy
Sheridan also commented on eBay’s planned $1.2 billion acquisition of Depop. The deal aligns with eBay’s strategy to expand into higher-growth categories.
While integration costs are expected to create a modest short-term headwind to operating income growth, the acquisition is viewed as strategically sound for long-term expansion.
Overall, Goldman Sachs believes eBay’s improving fundamentals and disciplined execution justify a more constructive outlook on the stock.
