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eBay could benefit from increasing social distancing amid coronavirus, says Wedbush, which upgraded shares

Wedbush has also lifted its target price on eBay to US$38 from US$34

eBay Inc -
The online group is not impacted, and can even 'partially benefit' from social distancing and self-quarantining, said the broker

Online auction giant eBay Inc (NASDAQ:EBAY) is one of the least impacted stocks by the global coronavirus pandemic that Wedbush covers.

That's the view of  the broker, which has upgraded the firm to Outperform from Neutral and hiked its target price.

The online group is not impacted, and can even "partially benefit" from the broad-based and increasing social distancing, self-quarantining, along with the potential for further store shutdowns and social gatherings, said Wedbush analysts.

READ: eBay's shares dip on festive forecast disappointment

The virus is bringing with it a wave of restrictions around the world on everyday life, including business and shop closures. In addition, millions of people have faced or are facing imposed isolation measures.

Wedbush has lifted its target price on eBay to US$38 from US$34 previously.

The stock is currently changing hands at US$32.56 each.

Ebay is the only stock in Wedbush's coverage, which has outperformed the market over the past month, it noted.

The broker also reckons eBay is the least likely to see significant guidance cuts in the first and second quarter, and while what happens in the third and fourth is more uncertain, the impact will still be "more muted in all likelihood" than most companies in Wedbush's coverage.

As announced late last year, eBay is selling its StubHub ticketing businesses to European rival Viagogo in a US$4 billion deal and has recently been in talks over a potential sale of its Classifieds business.

"We view the core marketplace as still under pressure, but also view upside potential from the lapping of more one time in nature 2019 impacts like internet sales tax and marketing headwinds," said analysts at Wedbush.

They said that while GMV (gross merchandise volume) growth is the most important long-term KPI (key performance indicator) for eBay, there was still plenty of challenge here for eBay to get back to a position of strength.

"... it should make enough progress in the near-term as it narrows its focus to verticals where it's historically been stronger," analysts added.

Quick facts: eBay Inc

Price: 55.21 USD

NASDAQ:EBAY
Market: NASDAQ
Market Cap: $38.64 billion
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