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Friday's Featured News
Recession Indicator: eBay's Stock Is Up More Than 50% Over the Past YearAuthor: Jessica Mitacek. First Published: 5/6/2026. 
Key Points
- eBay is outperforming the broader market in 2026, serving as a recession indicator as consumers turn to second-hand "recommerce" and collectibles to save money or generate income during economic weakness..
- The company beat Q1 expectations with a 19.5% revenue increase and 18% growth in Gross Merchandise Volume (GMV), driven by high demand for trading cards, collectibles, and precious metals.
- Following 14 consecutive quarters of earnings beats, eBay raised its full-year guidance and reiterated a $2 billion share buyback program, even as analysts maintain a cautious Hold consensus.
- Special Report: Elon’s “Hidden” Company
For more than 30 years, people have turned to eBay (NASDAQ: EBAY) to declutter their homes, cash in on old baseball cards and Beanie Babies, and sell vintage T-shirts their parents asked them to throw away decades ago. But eBay isn’t just an online marketplace and auction platform. The e-commerce company is also considered one of many counter-cyclical recession indicators. During economic downturns or periods of elevated inflation, the company—which often features discounted, second-hand, or refurbished items—typically sees increased activity as consumers look for value amid tighter budgets or try to generate income from unneeded goods.
While the consumer discretionary sector has been the fourth-worst performer among the S&P 500’s 11 sectors this year, eBay has bucked that trend. The stock is up around 20% in 2026, easily outpacing the index’s 5% gain, and over the past year, shares of EBAY have climbed more than 50%. The company recently reported Q1 FY2026 earnings, offering insights into the state of the broader economy and clues about how investors could position their portfolios ahead of a prolonged slowdown. More Sellers Are Turning to eBay as Economy Shows Signs of WeaknessThe uptick in eBay activity is most evident in its gross merchandise volume (GMV) metric. In Q1, GMV was 18% higher year over year (YOY). Specifically, GMV posted the largest gains in the company’s consumer-to-consumer transactions and recommerce—buying and reselling pre-owned, used, or refurbished goods. According to eBay, those categories saw GMV growth accelerate to 24% in the first quarter. In his earnings call comments, CEO Jamie Iannone highlighted other short-term catalysts, including the 30th anniversary of Pokemon in late February, which “fueled significant enthusiasm that translated into strong demand on [the] platform." Iannone also noted that trading cards, collectible coins, toys, action figures, and comic books all contributed to GMV growth. Perhaps most interestingly, the CEO said that eBay “also saw a transitory benefit to GMV growth from gold and silver bullion in response to precious metal prices.” Both metals reached all-time highs early in Q1, and Iannone noted that demand normalized by the end of the quarter. The company expects activity to return to historical levels in Q2, although that could be offset by the acquisition of Depop, which is expected to close in the second quarter. Still, eBay enjoyed plenty of tailwinds for GMV growth that should persist this year as economic uncertainty and elevated prices are expected to continue. The silver lining for investors is that shares of EBAY are reflecting the increased use of its platform, which the company underscored in its latest earnings report. eBay Beats on Top and Bottom Lines, Revises Full-Year GuidanceThose strong GMV gains translated into solid earnings when the company reported Q1 financials on April 29. Earnings per share (EPS) of $1.66 beat the consensus forecast of $1.58 by eight cents. The company hasn’t missed earnings for 14 consecutive quarters. The standout figure, however, was quarterly revenue, which was driven by the surge in GMV. eBay reported a YOY revenue increase of 19.5%, reaching $3.09 billion and topping analyst expectations of $3.04 billion. Better-than-expected Q1 sales led to upward revisions to Q2 revenue and full-year GMV. eBay now forecasts quarterly revenue in the range of $2.97 billion to $3.03 billion, which would represent an 8% to 10% YOY increase, while full-year GMV growth was raised to 7% to 7.5%. Additionally, the company reiterated its plan to repurchase approximately $2 billion of its shares this year. That is part of a stock buyback authorization announced in February and includes $625 million for Q2. With an improved forward price-to-earnings ratio, eBay’s EPS is expected to grow by 11.25% over the next year, from $4.89 per share to $5.44 per share. Wall Street Remains Cautious Despite Upgraded ExpectationsWhile the company’s first-quarter performance was notable and eBay remains a useful counter-cyclical recession indicator, analysts are taking a wait-and-see approach. After a sharp run-up in share prices this year, the consensus 12-month price target of around $105 suggests moderate downside from where the stock is currently trading. At the same time, more than half of the analysts covering the stock (18 of 33) rate EBAY a Hold. However, it’s worth noting that one year ago, Wall Street’s price target for EBAY was $67.12, nearly 39% lower than the stock’s current price, and analysts were forecasting more than 2% downside rather than the more than 50% upside shareholders have seen since then. Institutional ownership remains above average at more than 87%, but outflows of more than $7 billion have outnumbered inflows of nearly $5 billion, with selling outpacing buying for four consecutive quarters. Meanwhile, short interest of 2.95% of the float, or $1.31 billion, is down nearly 39% from its one-year high of $2.14 billion in May 2025. |
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