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June 28, 2022, 11:55 a.m. EDT

EBay stock downgraded as UBS worries about potential recession impacts on e-commerce

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By Emily Bary

Shares of eBay Inc. /zigman2/quotes/204653455/composite EBAY +1.41% were falling 2.5% in Tuesday morning trading after UBS analyst Kunal Madhukar downgraded the stock to neutral from buy, writing of growth concerns regarding the online marketplace. "Expectations are low, with non-Focus categories declining and with Focus categories, which are doing better, comprising purely discretionary spend which could be disproportionately impacted in a downturn," Madhukar wrote in a note to clients. The downgrade comes amid a UBS analysis of how the e-commerce sector could fare in a downturn, with Madhukar highlighting the rising possibility of a recession. He sees "greater macro sensitivity" for the e-commerce space in a modern recession, whereas e-commerce was still a small portion of overall retail sales during the financial crisis. Additionally, he worries that when the market recovers, eBay "could lag smaller-cap peers (which are likely to grow much faster in a recovery) until investors have better visibility into organic growth at eBay." Shares of eBay have declined 35% so far this year as the S&P 500 /zigman2/quotes/210599714/realtime SPX +2.11% has dropped 19%.

/zigman2/quotes/204653455/composite
US : U.S.: Nasdaq
$ 48.68
+0.67 +1.41%
Volume: 3.02M
Aug. 10, 2022 3:42p
P/E Ratio
N/A
Dividend Yield
1.81%
Market Cap
$26.87 billion
Rev. per Employee
$928,056
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/zigman2/quotes/210599714/realtime
US : S&P US
4,209.33
+86.86 +2.11%
Volume: 2.22B
Aug. 10, 2022 3:42p
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