Citigroup upgraded eBay (EBAY ) to buy from hold.
Analyst Mark Mahaney says his estimates remain unchanged, but renewed confidence has led him to slightly increase his long term growth assumptions and multiple. He raised his $45 price target to $51.
Mahaney says following eBay's second-quarter results, he has increased conviction that the quarter was an inflection point for the company's fundamentals. Further, he views Google's (GOOG ) definitive announcement that it is not working on a PayPal competing product as a removal of a signficant negative catalyst.
Hence, based on channel checks, his proprietary listing database, and incremental analysis, he believes second-quarter trends are sustainable.