Jobs, taxes, and travel captured the interest of U.S. Internet surfers in January, marking double-digit to triple-digit gains over the previous month, according to a ComScore report released Thursday.
The number of unique visitors heading to tax sites climbed 176 percent to 24,703 in January, as users geared up for the upcoming tax season, according to ComScore.
Travel sites, meanwhile, posted a 46 percent increase to 13,028 visitors last month, as users took advantage of falling fuel prices and a desire to plan ahead for their vacations, while job search sites climbed 42 percent to 26,702 visitors, in January.
(Credit:
ComScore)
With unemployment running at 7.6 percent nationwide in January and Americans across all industries concerned about their job security, it's not surprising job-related sites are gaining an increase.
According to a January ComScore survey, U.S. residents earning less than $50,000 have had the highest unemployment rate, while those earning $50,000 up to $100,000 are extremely concerned with losing their jobs.
(Credit:
ComScore)
That type of concern may not bode well for giving a kick-start to e-commerce spending, noted Gian Fulgoni, ComScore's executive chairman, during a press conference Thursday to discuss the January e-commerce results.
The middle-class, for example, accounts for 46 percent of online retail spending, while the upper-class represents 34 percent, he noted.
And although these two groups posted a 2 percent and 8 percent increase in January year-over-year retail e-commerce spending, respectively, this type of concern over job security could lead to belt-tightening down the line, he noted.
During January, U.S. retail e-commerce spending rose 2 percent over the previous year, according to ComScore.
E-commerce spending on sports and fitness rose 42 percent in January over the previous year, while books and magazines captured a 37 percent increase and home, garden, and furniture climbed 14 percent, the report noted.
Investors pushed eBay's stock down for a third consecutive day Thursday, after the e-commerce giant reported third-quarter earnings and reduced its fourth-quarter forecast amid a meltdown in the economy.
Shares of eBay fell as low as $13.69 in intraday trading, down 12 percent from Wednesday's close. But by the market's close, eBay's shares were down a mere 2.35 percent to end the day at $14.97, as the broader markets closed out with gains.
Earlier in the day, eBay's shares were whacked as Wall Street weighed in, with a number of analysts reducing their earnings estimates and price targets.
UBS Securities dropped its 2008 earnings estimates for eBay to $1.70 a share from $1.73 a share. It also reduced its 2009 estimates to $1.61 a share from $1.73 a share and reduced its six-month price target to $17 a share from $18.
In a research report by analyst Ben Schachter, UBS noted the following:
The company reported seeing weakness in the business from mid-August on, particularly in the retail and auto verticals, and also pointed to slowing overall e-commerce trends...We expect a broader economic slowdown will serve to exacerbate eBay's primary company-specific problem area (and the main obstacle to getting the stock moving again, in our view): slowing growth in its core Marketplaces business.
Schachter noted that although eBay is making moves to stabilize and increase transactions on its site, through such plans as increasing marketing and offering coupons in the fourth quarter to sellers, Wall Street expects competition to be fierce this quarter as e-commerce players duke it out over what is expected to be sparse pool of potential customers.
Schachter further added:
We continue to view eBay as in the midst of an identity crisis, in some respects. The company wants to stay true to its heritage as the destination for buying interesting/used/value goods and collectibles through auction listings; however, it also clearly wants to compete in fixed-price listings (an area where we don't believe the company has a natural advantage) to spur growth in its core. It's exceedingly unclear if the company can do both.
Goldman Sachs, meanwhile, cut its eBay earnings estimates for the fourth quarter, as well as for the fiscal years 2009 and 2010.
Goldman reduced its fourth-quarter eBay estimates by 16 percent, to 41 cents a share, cut 2009 estimates by 13 percent, to $1.64 a share, and cut 2010 estimates by 16 percent, to $1.74 a share.
We do not expect eBay's stock to perform until investors have more confidence that the earnings it is reporting are compatible with renewed GMV (gross merchandise volume) growth; 4Q 2008 earnings weakness appears to flow from macro issues and slowing GMV, rather than from eBay transitioning its business model, which may still lie ahead.
JPMorgan Chase analyst Imran Khan, meanwhile, downgraded eBay to "hold" from "buy," as well as cut its earnings estimates for the e-commerce company for a second time this week. Khan now estimates that eBay's GAAP earnings next year will be up only 3 percent, verses his previous forecast of 15 percent.
Khan said eBay's woes lie in its technology platform:
We believe eBay's biggest challenge is an inferior technology platform, which is making it difficult for the company to compete with other e-commerce platforms, such as Amazon's. In our view, the company has yet to deliver meaningful improvements in search functionality or user experience, which we believe is evident in the inverse relationship between the listing growth rate and conversion rate. We think that if eBay fails to improve the user experience, it will inhibit future growth, even when the economy recovers.
But Brian Pitz, a Bank of America Securities analyst, believes that eBay's platform is "not broken."
Instead, Pitz noted in his research report that eBay is suffering from the same aliment as other e-commerce players, which is a lack of consumer demand in this current economic climate.
Like other analysts, Pitz reduced eBay's 2009 expectations and price target. He forecast eBay to see a 2 percent reduction in revenues in 2009 and to see its earnings per share fall by 7 percent.
Pitz reduced eBay's 12-month price target to $25 a share from $29 a share.
Meanwhile, analysts at Sanford C. Bernstein were seeing green:
We think that the sell-off was an overreaction. Management's reduction of 4Q:08 guidance was in anticipation of continuing consumer weakness, dollar appreciation, and the earnings dilution caused by the BML acquisition (expected to close in 4Q:08).
Sanford noted that it is maintaining its "outperform" rating.
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