I don’t own any shares of ebay, but I casually follow the stock out of interest. After all, it’s an internet bellwether, so it indirectly affects my company Zillow. As has been widely covered, ebay reported mixed earnings yesterday. They are shifting their marketing focus from auctions to fixed price transactions, and they’re also revamping their pricing structure on auctions to emphasize final sale price rather than listing fees. And finally, longtime CEO Meg Whitman will retire on March 31 and be replaced by her hand-picked successor and former Bain Consulting colleague, John Donahoe.

But here’s what I find interesting – look at the reaction by the equity research community, the research analysts who cover ebay for various investment banks. These are all highly qualified people, experts in their field, masters of financial analysis, all looking at the same numbers. But they have highly divergent opinions about the future of ebay.

Ebay is at $27 today.

The Bulls:

• Jennifer Watson (who replaced Anthony Noto), Goldman Sachs: Buy, $38 price target (down from $42). “We maintain our Buy rating on eBay shares given ~30% upside to our new $38 price target (down from $42), which reflects a more conservative stance on 2008 and 2009 due to impending pricing changes and the economy.”
• Robert Peck, Bear Stearns: Outperform, $36 price target. “We continue to believe that eBay is a Franchise with: a strong balance sheet, solid FCF generation, comparatively more recession insulation, faster growing diversifying revenue streams and an attractive valuation (10.5x 08 EBITDA and 18x PE with 6% FCF yield).  We think the changes will therefore provide opportunity if the new management team can execute.”
• Imran Khan, JP Morgan: Overweight. “On EV/EBITDA, eBay trades at 10.6x our F’08 est., vs. peers at 15.6x F’08 est. We think such a discount is unwarranted.”
• Youssef Squali, Jeffries: Buy, $40 price target (down from $46): “Sluggish growth in the core auctions business continues to be a drag on overall revenue growth. While we remain cautiously optimistic about the company's ability to re-accelerate GMV growth by tweaking supply and demand, we are trimming our LT growth estimates to reflect lack of visibility into the turnaround.”
• Christa Quarles, Thomas Weisel Partners: Overweight, $38 price target: “eBay's valuation remains contingent on its ability to maintain its current growth trajectory while holding on to its leadership position as an online marketplace and e-commerce destination. Equally critical elements to the eBay story are the expansion of PayPal off the eBay platform and the leveraging of Skype's audience and technology to deliver value-added VoIP services.”
• Scott Devitt, Stifel Nicolaus: Buy, $39 price target: “eBay is an inexpensive business as measured by any statistical yardstick. Based on after hours pricing of $27.50, eBay shares trade for 14.2x our estimate of 2008 unlevered FCF ($2.174 billion, $2.35 billion less $176 million of interest income). If eBay were an inventory-free retailer, and it claims its not, it would qualify as one of the world's fastest growing, lowest FCF multiple general merchandise retailers. As such, it is an internet marketplace, which makes 14x FCF seem more palatable in the mind of the market.”

The Bears:

• Doug Anmuth, Lehman Brothers: Hold, $30 price target (down from $33). “We would remain on the sidelines [nearterm] until we have a better sense of the details around eBay's platform changes and their potential impact on buyers and sellers going forward.”
• Ben Schachter, UBS: Hold, $32 price target (down from $38): “…the growth rates in the core continue to deteriorate, and until we can confidently call a bottom in the core, it is difficult to get behind the stock. The uncertainty regarding the new CEO’s efforts to boost core marketplace growth rates, as well as soft guidance, keep us on the sidelines.
• Derek Brown, Cantor Fitzgerald: Sell, $25 price target (down from $30): “Our previous research warned that 1H:08 may prove to be a period of heightened uncertainty for eBay and its shareholders; yet, even  we are suprised by the volume and magnitude of change that eBay has elected to pursue at this time, after having done so little for so long.”

There is a huge range of price targets here – from $25 at the low end to $40 at the high end. It’s surprising to me that these people have reached such different conclusions with the same information. Of course, that’s what makes a horse race (or a volatile stock price, in this case). After all, every single share of stock that trades hands is the result of divergent opinions about that company: the seller think the stock will go down, the buyer thinks it will go up. Still, you don’t see such divergence on another internet bellwether, Google, where 30 out of the 33 analysts who cover the company have a Buy or Strong Buy.

Time will tell…