Jefferies warns that eBay's reliance on high-margin advertising is reaching a plateau, with slowing growth and increased exposure to lower-margin initiatives threatening future earnings estimates.
Jefferies reiterated Underperform and cut its price target to $75 from $80, citing EBITDA downside and slowing advertising growth.
Jefferies reiterated an Underperform rating on eBay, slashing its price target to $75 from $80. The firm cites persistent pressure on underlying EBITDA and a projected deceleration in high-margin advertising revenue, which has historically masked weaker core profitability.
Jefferies expects slowing advertising growth and a shift toward lower-margin business initiatives to weigh on profitability, noting that underlying EBITDA has declined annually since 2023.