By Dhirendra Tripathi

Investing.com – eBay stock (NASDAQ:) traded 3.6% higher Tuesday after Deutsche Bank (DE:) initiated coverage with a ‘buy’ and a target of $145, more than 168% higher than its current level of $54.

StreetInsider analyst Lee Horowitz believes that the market underestimates eBay’s position within secular growth trends. He finds the stock’s valuations compelling.

eBay’s fourth-quarter results had disappointed but weren’t a surprise either given that shoppers were bound to log off the site after two years of the pandemic to step out and shop.

Gross merchandise volume for the fourth quarter, which is a crucial benchmark that determines total sales on an online marketplace, dropped 10% to below $21 Billion. E-commerce firms’ revenue is derived from a percentage of GMV. 

The quarter saw a decrease of 9% in annual active buyers to the platform, from 147 million to 149 million.

Retailer forecasts annual revenue of $10.4 Billion and an adjusted profit per share at $4.3, which is the middle of its guidance range. GMV is seen between $78.3 billion and $80.5 billion, a guidance the analyst called “conservative”.

As the company’s core operations remain under pressure, CEO Jamie Iannone is banking on advertising and payments businesses to make up for it. For the first time in a year, advertising revenues exceeded $1 billion. The company anticipates that the transition from all its sellers to the new payment platform will result in increased profits.

Horowitz says that the market also doesn’t appreciate the emphasis on execution Iannone brought to the business after taking control of the company less than two year ago.