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NEW YORK (AP) — An analyst increased eBay's price target on Wednesday, anticipating strong growth at PayPal and improved online sales.
Janney Capital Markets' Shawn Milne says PayPal, eBay's payment division, should benefit from healthy online spending and that its deal with Discover will help to broaden its reach.
PayPal announced in August that it was expanding its brick-and-mortar payment services to more than 7 million stores across the U.S. in a partnership with credit-card issuer Discover Financial Services. PayPal has more than 50 million active users in the U.S. and is eBay's fastest-growing business.
The analyst said in a client note that eBay also seems to be positioning itself well for the holiday season, as it has more brands, like Coach, now selling on its e-commerce websites.
The company has said it is benefiting as more people shop using their mobile devices.
While there is still concern about economic conditions in Europe, Milne said a slight rebound in the euro could help revenue in the short term. A weaker dollar compared with last year gives a boost to the company's revenue from overseas when it's translated back into the dollar.
The analyst raised eBay Inc.'s price target to $58 from $46 and kept a "Buy" rating. Shares of the San Jose, Calif., company closed at $49.96 Tuesday and are up 65 percent in 2012.