eBay (EBAY) Last Update 11/13/24
Related: GOOG AMZN AKAM VRSN
% of Stock Price
Revenue
Gross Profits
Free Cash Flow
eBay
STOCK PRICE
DIVISION
% of STOCK PRICE
Net Debt
4.3% $2.71
TOTAL
100%
$63.48
$59.91
Yours
Trefis Price
N/A
$63.16
Market
 
Top Drivers for Period
Key Drivers
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TREFIS Analysis


Trefis Report
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RECENT NEWS AND ANALYSIS

Potential upside & downside to trefis price

eBay Company

VALUATION HIGHLIGHTS

  1. Transaction Revenues constitute 95% of the Trefis price estimate for eBay's stock.

WHAT HAS CHANGED?

EBAY Stock Performance

EBAY stock has shown strong gains of 35% from levels of $45 in early January 2021 to around $60 in mid-November 2024, vs. an increase of about 60% for the S&P 500 over this roughly four-year period.

However, the increase in EBAY stock has been far from consistent. Returns for the stock were 34% in 2021, -36% in 2022, and 8% in 2023. In comparison, returns for the S&P 500 have been 27% in 2021, -19% in 2022, and 24% in 2023 - indicating that EBAY underperformed the S&P in 2022 and 2023.

Latest Earnings

For FY 2023 revenue was $10.1 billion, down 3% y-o-y. Gross Merchandise Volume was $73.2 billion, down 1% on a reported basis. GAAP and Non-GAAP operating margin were 16% and 26.7% respectively. Annual active buyers were 132 million globally.

In Q3 2024, the company posted net revenues of $2.6 billion - up 3% y-o-y. Further, the Gross Merchandise Volume (GMV) increased 2% y-o-y to $18.3 billion. eBay reported adjusted earnings of $1.19 per share, compared to $1.03 in the prior-year quarter.

Impact of Coronavirus

IT software and Services industries suffered from a fall in demand for software and web services in 2020, as consumers were solely focused on essentials and not discretionary products. That said, companies with a portfolio of software, as well as services aimed at remote collaboration, benefited due to the growing number of people globally. Further, Online marketplaces gained more traction due to lockdowns and restrictions in various regions, leading to eBay gaining buyers. Notably, the elevated user traffic during 2020 and 2021 was the main reason behind revenue growth. However, with the re-opening of offline retail stores and the lifting of COVID-19-related restrictions, the top line suffered in 2022.

eBay Marketplaces

  • eBay Transaction Revenues: We currently forecast the transaction revenues to grow at a CAGR of around 1.5-2% through the end of our forecast period, driven by an increasing number of users and a gradually improving take rate (note: take rate is eBay's commission on items sold).

  • eBay EBITDA Margin: We currently forecast eBay EBITDA margin to be around 33-34% by the end of our forecast period.

For additional details, select a driver above or select a division from the interactive Trefis split for eBay at the top of the page.

BUSINESS SUMMARY

eBay is known for operating the online marketplace eBay.com. The company's marketplace is where third-party buyers and sellers can transact in a variety of products including clothing, electronics, media, collectibles, automobiles, and many other types of merchandise.

KEY TRENDS

Growth In Global E-Commerce Volume

The global e-commerce market is growing at healthy rates owing to the growing popularity of online shopping. According to Morgan Stanley, the global retail e-commerce market is expected to cross $5.4 trillion by 2026. In the event, eBay is able to overcome its challenges, it could benefit from this high demand in the market. However, owing to increased competition from Amazon, Alibaba, and traditional retail giants, we expect eBay to underperform the broader e-commerce market in the coming years.

Focus on Increasing Conversion Rate

Conversion rate is a key focus area for eBay, as it seeks to increase the success of sellers in converting listed items to sold items. eBay has implemented several features to increase the conversion rate on marketplaces and continues to improve the customer experience on its marketplaces. eBay has also complemented these features with search engine optimization (SEO) changes and broadening its marketing channels to include social platforms.