Why Is eBay Stock Down Today?

Investors have been asking us "why is eBay stock down today?" as shares of the e-commerce company are down more than 11% below $29 Thursday.

The eBay Inc. (Nasdaq: EBAY) stock price is declining today because the company reported weaker than expected Q4 guidance. That's despite the fact it posted better than expected Q3 earnings.

Here are the key details from the eBay earnings report released after Wednesday's close...

Why Is eBay Stock Down: Behind the Numbers

• EBay posted Q3 earnings per share (EPS) of $0.45. That beat analysts' estimates of $0.44.
• Revenue came in at $2.22 billion, ahead of the projected $2.19 billion.
• Revenue at its StubHub unit rose 32% to $263 million.
• Gross merchandise volume (GMV) - a key measure of the dollar value of everything sold on eBay - totaled $20.1 billion. That was up 5% year over year. But it was less than the $20.3 billion expected.
• EBay added more than 1 million new buyers in Q3, taking its global active buyers total to 165 million.
• The e-commerce company is sharpening its brand focus via several marketing pilots. For example, eBay will advertise on TV this holiday season, something it hasn't done since 2014.
• EBay is also excited about mobile, as customers' reviews trended higher. The company recently released its fifth mobile update.
• EBay expects adjusted EPS of $0.52 to $0.54 for the crucial holiday season. That was near the low end of analysts' forecast for $0.54.

That last figure is the biggest reason eBay stock is tanking today. Investors aren't the only ones concerned with the eBay stock price; a number of analysts have also downgraded the stock.

While eBay has name recognition in the United States, we've been targeting a different e-commerce stock. And our pick looks like an even stronger buy after today's drop for eBay stock...

Avoid the Tanking eBay Stock, Buy This One Instead

Here are some of the analysts' projections for eBay stock following today's rout...

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• Wedbush maintains a "Neutral" rating on eBay stock and lowered its eBay stock price target to $33 from $34.
• Mizuho Securities said eBay needs to push efforts to drive sales and conversions in order to get its growth rate back on track. Until then, Mizuho is remaining on the sidelines.
• Needham Research believes the focus now is squarely on 2017. The firm is also concerned that operating margin could shrink with a shift in revenue mix towards the lower-margin, faster-growing platforms, increased branded marketing, and acquisition integrations.

Today's eBay stock price drop erased much of the company's year-to-date gains. At $29, eBay stock is up 5.80%.

For now, we are passing on eBay stock. But there is one e-commerce company that we are bullish on: Alibaba Group Holding Ltd. (NYSE: BABA).

Alibaba stock is up 28.24% so far this year and is one of the best long-term stocks investors can buy now, according to Money Morning experts. Here's our complete outlook on Alibaba stock, including our Alibaba stock price prediction...

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Related Articles:

• Los Angeles Times: Stocks Open a Bit Lower; eBay Dives 10%
• Business Wire: eBay Inc. Reports Third Quarter 2016 Results
• The Street: Jim Cramer - What I'm Watching in eBay's Earnings