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Bear Stearns Upgrades eBay

In case of recession, we buy used crap

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When I mentioned this aloud, someone responded, "Going out on a limb, aren’t they?"  But Bear Stearns has upgraded its outlook on eBay, and even if a gut reaction might be to scoff (the Dow is down another 300 points just now), the action isn’t as crazy as it sounds.

A rumor is circulating that eBay might lower its fees; we covered it earlier today if you find yourself wanting more information.  The upshot, though, is that a change might create a short-term boost in the company’s profits, and Bear Stearns cited this possibility as one of the reasons behind its "outperform" rating.Bear Stearns Upgrades eBay

Bear Stearns‘s analysts also addressed leadership issues; some onlookers have pushed for the retirement of CEO Meg Whitman.  "We believe that Meg recently indicated that she would not be leaving shortly," they wrote.

They then continued, "However, we do believe that John Donahoe has been groomed as a potential replacement.  We hear from the Community that he has been very receptive to feedback and is actively focused on eBay’s issues.  Hence, whether Meg leaves or not, we think there is a deep bench and most importantly they are aware and addressing the issues, shunning the ostrich defense."

Finally, although the cause-effect relationship can be debated, eBay has thus far managed to meet Bear Stearns’s expectation, rising $0.34, or 1.21 percent, so far today.

Bear Stearns Upgrades eBay
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