Ebay Inc (NASDAQ:EBAY) stock was up on Wednesday following a major upgrade from Morgan Stanley.
The upgrade comes from Morgan Stanley analyst Brian Nowak. Rather than just increase the firm’s rating for the stock from “Underweight” to “Equal Weight’, the analyst skipped straight to the “Overweight” rating for EBAY stock.
To go along with that rating upgrade for EBAY stock is a price target increase. Nowak set a new price target of $58 per share for eBay Inc. The previous rating that Morgan Stanley had for the online marketplace was $36.
The recent decision to place such a major upgrade on EBAY stock has to do with its payment platform plans. The company is working with Dutch company Adyen BV on a new payment service after choosing not to further its relationship with Paypal Holdings Inc (NASDAQ:PYPL).
Nowak believes that this decision could result in rapid increase to eBay Inc’s earnings per share and other growth at the company. This includes the possibility of $2.6 billion in payment revenue by 2021, reports TheStreet.com.
“We expect EBAY to start intermediating its own payments (pulling away from PayPal) in ’18 as management stated on its 4Q:17 conference call, with a planned full transition in mid-2020,” Nowak said in a note to clients obtained by CNBC. “We are bullish about this initiative as we’ve seen other leading platforms … observe higher user conversion/spend from.”
EBAY stock was up 2% as of Wednesday afternoon and is up 6% year-to-date.
As of this writing, William White did not hold a position in any of the aforementioned securities.
