PayPal and eBay no longer friends?
PayPal Holdings (PYPL) announced earnings of $0.55 per share yesterday, which exceeded Wall Street expectations of $0.52 per share. However, the stock was trading lower as their forward guidance did not meet expectations.
Things got worse when eBay (EBAY) announced that it would begin using a Dutch firm called Adyen as its primary payments provider. This would lower the cost of doing business on eBay by reducing transactions costs for its merchants.
PayPal will remain an option for customers at least until 2023. However, eBay expects most of its payments to be processed by Adyen by 2021.
In Thursday morning trading, EBAY was trading 13% higher on the news, while PYPL was down 9%.
Our analysis of the EBAY chart below shows the stock moving higher as it begins a new market cycle. Our near-term projection is $49.
Our analysis of the PYPL chart shows possible continued price action to the downside into May, with a price target near $68.
The market cycles on the charts below are designated by the black semicircles at the bottom of the chart.
EBAY Stock Chart (Weekly Bars)
PYPL Stock Chart (Weekly Bars)
Visit our site for more on our approach to using market cycles to analyze stocks.
Twitter: @askslim
Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.
