Online marketplace and merchant eBay saw its stock hit a five-year high this morning, as its shares rose 12 percent in early trading following a strong first quarter report late last night.
eBay reported that net income climbed 20 percent and revenue rose 29 percent, based in large part on the strength of its PayPal division and the explosion of mobile retailing.
“PayPal is the growth driver of this company,” Colin Gillis, an analyst at BGC Partners, told the NY Times. “PayPal continues to be a star. Marketplaces is showing clear signs of turning around. Business is growing. And they’re positioned for the future.”
Other analysts were equally bullish on the company’s fundamentals. “The bottom line is that EBAY is executing,” said analyst Ben Schacter of Macquarie. ”We believe that product improvements, solid business management, and strong tailwinds from mobile are driving upside to estimates. We expect that will continue throughout 2012 and beyond.”
eBay’s traditional marketplace business grew 11 percent year over year growth. It has a renewed focus on becoming a traditional retailer, competing with the likes of Amazon, especially in mobile commerce. And PayPal is moving into offline retail with mobile card readers and PayPal systems installed in thousands of stores last year, including big chains like Home Depot.
eBay also made a smart social acquisition in the last year, picking up New York City startup Hunch and using that team to kick off an engineering office in Silicon Alley.