Talking Numbers contributor Richard Ross, Global Technical Strategist at Auerbach Grayson, believes eBay is a buy as well, but because of the technicals and because Carl Icahn has invested in the company.
"I don't know about the job that the CEO is doing," says Ross. "But, I know about the job that Carl Icahn is doing and I think investors are served well to do exactly what he's doing in this case, which is to be a buyer of eBay's stock."
Though eBay was up 65% in 2012, it traded in a slightly downward-sloping trend channel for 2013 and the beginning of 2014. That changed a few weeks ago when Icahn announced his interest in the company. That caused a spike above the trend channel, which Ross says is a bullish flag pattern that could add another 40% or more to the stock.
"There could be as much as $25 on the upside if my technical work is correct – and, occasionally, it is," says Ross, who gets to a target of an additional $25 because the trend channel it broke from was $25 wide. "I would be a buyer here of eBay just on the chart alone."
"I don't know about the job that the CEO is doing," says Ross. "But, I know about the job that Carl Icahn is doing and I think investors are served well to do exactly what he's doing in this case, which is to be a buyer of eBay's stock."
Though eBay was up 65% in 2012, it traded in a slightly downward-sloping trend channel for 2013 and the beginning of 2014. That changed a few weeks ago when Icahn announced his interest in the company. That caused a spike above the trend channel, which Ross says is a bullish flag pattern that could add another 40% or more to the stock.
"There could be as much as $25 on the upside if my technical work is correct – and, occasionally, it is," says Ross, who gets to a target of an additional $25 because the trend channel it broke from was $25 wide. "I would be a buyer here of eBay just on the chart alone."