Jan. 25 (Bloomberg) -- Shares of EBay Inc., the world's largest online auctioneer, rose the most in eight months after the company boosted its full-year profit forecast and posted a 24 percent fourth-quarter profit gain, spurred by growth in Europe.

The company, based in San Jose, California, also said it will repurchase as much as $2 billion in additional stock.

Overseas revenue growth outpaced U.S. sales because of a boost in overall demand from German buyers and a strong U.K. holiday season, EBay Chief Financial Officer Robert Swan said yesterday in a conference call with investors.

``The international marketplace performed incredibly well,'' said Timothy Boyd, an analyst with New York-based Caris & Co., who has an ``above average'' rating on the stock. Shares may rise to $40 within the next six months, Boyd said.

The stock rose $2.45, or 8.2 percent, to $32.45 at 4:16 p.m. in Nasdaq Stock Market composite trading.

EBay's net income rose 24 percent to $346.5 million, or 25 cents a share, from $279.2 million, or 20 cents, a year earlier. Revenue increased 29 percent to $1.72 billion, EBay said in a statement yesterday.

Listings increased 12 percent as the company benefited from users selling hard-to-find Sony Corp.'s PlayStation3 and Nintendo Co.'s Wii game consoles. EBay also offered rebates and free shipping to users of its online payment service PayPal to fend off competition from Google Inc.'s Checkout, helping the division's revenue climb 37 percent.

Listings Increase

``Listings were up huge, and PayPal is going to be another tremendous growth story,'' said Matthew Kelmon, who helps manage $400 million, including EBay shares, as president and portfolio manager at Kelmoore Investment Co. in Palo Alto, California. ``EBay's got a huge lead on everyone.''

Safa Rashtchy, an analyst with Piper Jaffray & Co., upgraded his rating on EBay to ``market perform'' from ``underperform'' today and boosted the price target to $30 from $25, citing fourth-quarter results and the stock's performance in the months before yesterday's earnings announcement. The company's shares fell 30 percent in 2006.

Overseas revenue increased 40 percent, with strength in the U.K., Italy, France and Australia, and accounted for almost half of EBay's total sales. EBay also benefited from a weaker dollar, said Swan. Adjusted for foreign exchange rates, sales rose 24 percent.

EBay said 2007 profit excluding some expenses would be as much as $1.29 a share, after previously indicating in October that earnings would be at least $1.22. Analysts were estimating $1.23.

Revenue Forecast

Revenue will be between $7.05 billion and $7.3 billion for the year, the company said, in line with estimates. First- quarter profit will be as much as 30 cents a share on sales of as much as $1.72 billion, EBay said.

Excluding expenses such as stock options, EBay earned 31 cents a share in the fourth quarter, beating the 28-cent average estimate of 22 analysts in a Bloomberg survey. Revenue was estimated to be $1.67 billion.

During the quarter, EBay repurchased 31 million shares, valued at $1 billion. The company has an additional $300 million on its existing buyback plan and said it may repurchase as much as an additional $2 billion in stock, or about 4.8 percent of the shares outstanding based on yesterday's stock price.

EBay's auction revenue rose 24 percent to $1.24 billion while PayPal sales increased to $416.8 million, about a quarter of the company's revenue.

EBay's new listings rose in the fourth quarter as consumers and sellers used the site over the holidays. EBay users posted 610 million new listings in the fourth quarter.

Other Divisions

To lure more customers, EBay agreed Jan. 11 to purchase closely held StubHub Inc. for $310 million. The company will add as much as $120 million to EBay's 2007 revenue, Swan said on the conference call.

The company is also trying to bolster revenue through its Skype Internet phone service, which EBay bought in 2005 for $2.6 billion.

Skype's 2006 revenue, which accounted for 3.3 percent of EBay's total sales, missed company projections, Chief Executive Officer Meg Whitman said today in an interview. Skype's fourth- quarter sales more than doubled to $65.6 million.

``From a revenue perspective, we did not monetize them as we originally anticipated, although it was close,'' said Whitman.

To contact the reporter on this story: Danny King in New York at dking19@bloomberg.net

Last Updated: January 25, 2007 16:21 EST