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EBay Rises On Outperform Rating

By: David Utter

Bear Stearns analyst Robert Peck thinks the online marketplace will step up in its Wall Street performance this year.

eBay Rises On Outperform Rating

Peck isn't bearing down on eBay as others have in the past year. In 2008, Meg Whitman and company should benefit from a few factors. cited Peck's opinion that eBay's business tends to be counter cyclical. 4Q financial results that meet analyst expectations will help the Street feel a little better about eBay's prospects.

Enhancing their fortunes means bringing in more sellers, a prospect that has confounded eBay at times. Fleeing sellers complained of higher fees and stingy bargain-hunting buyers limiting their profitability.

Sellers will get a break when a new fee structure gets put into place. Ina Steiner at AuctionBytes said category-based pricing and volume-discount pricing could be on tap.

Steiner noted that the volume-discount pricing idea could be a lightning rod for sellers. CEO Whitman once promised that eBay would not go against the "level-playing field" ideal of eBay founder Pierre Omidyar.

But whispers of her possibly forthcoming departure, coupled with favorable October 2007 chatter about volume pricing, could herald a change to that policy.

"President of eBay Marketplaces North America Bill Cobb said that in a conversation with Omidyar, the founder had said he never intended for the term level playing field to indicate the site would never offer volume discounts," Steiner said.

Peck has a target of $36 for eBay, which opened today at $28.17. The cautious observer should note Cantor Fitzgerald analyst Derek Brown rated eBay a "sell" last week, with a target of $30.

About the Author:
David Utter is a staff writer for InternetFinancialNews and WebProNews covering technology and business.

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