eBay Stock Shares $20 Bil Success With Investors
In the last five years, eBay (EBAY) stock has returned $20 Bil back to its shareholders through cold, hard cash via dividends and buybacks. Let’s look at some numbers and compare how this payout power stacks up against the market’s biggest capital-return machines.
As it turns out, EBAY stock has returned the 92nd highest amount to shareholders in history.
| EBAY | S&P Median | |
|---|---|---|
| Dividends | $2.6 Bil | $3.0 Bil |
| Share Repurchase | $17 Bil | $3.0 Bil |
| Total Returned | $20 Bil | $6.0 Bil |
| Total Returned as % of Current Market Cap | 41.9% | 17.3% |
Why should you care? Because dividends and share repurchases represent direct, tangible returns of capital to shareholders. They also signal management’s confidence in the company’s financial health and ability to generate sustainable cash flows. And there are more stocks like that. Here is a list of the top 10 companies ranked by total capital returned to shareholders via dividends and stock repurchases.
Top 10 Stocks By Total Shareholder Return
| Total Money Returned | As % Of Current Market Cap | via Dividends | via Share Repurchases | |
|---|---|---|---|---|
| AAPL | $508 Bil | 12.0% | $76 Bil | $432 Bil |
| GOOGL | $288 Bil | 6.0% | $20 Bil | $268 Bil |
| MSFT | $223 Bil | 7.1% | $108 Bil | $115 Bil |
| JPM | $181 Bil | 21.7% | $72 Bil | $108 Bil |
| XOM | $157 Bil | 25.5% | $79 Bil | $78 Bil |
| META | $156 Bil | 10.0% | $12 Bil | $145 Bil |
| BAC | $129 Bil | 33.7% | $45 Bil | $84 Bil |
| CVX | $116 Bil | 32.0% | $58 Bil | $57 Bil |
| WFC | $108 Bil | 44.5% | $23 Bil | $85 Bil |
| NVDA | $96 Bil | 1.9% | $3.0 Bil | $93 Bil |
For full ranking, visit Buybacks & Dividends Ranking
What do you notice here? The total capital returned to shareholders as a % of the current market cap appears inversely proportional to growth prospects for reinvestments. Stocks like Meta (META) and Microsoft (MSFT) are growing much faster, in a more predictable way, compared to the others, but they have returned a much lower fraction of their market cap to shareholders.
That’s the flip side to high capital returns. Sure, they are attractive, but you have to ask yourself the question: Am I sacrificing growth and sound fundamentals? With that in mind, let’s look at some numbers for EBAY. (see Buy or Sell eBay Stock for more details)
eBay Fundamentals
- Revenue Growth: 12.5% LTM and 5.8% last 3-year average.
- Cash Generation: Nearly 14.5% free cash flow margin and 19.6% operating margin LTM.
- Recent Revenue Shocks: The minimum annual revenue growth in the last 3 years for EBAY was 1.5%.
- Valuation: eBay stock trades at a P/E multiple of 23.4
| EBAY | S&P Median | |
|---|---|---|
| Sector | Consumer Discretionary | – |
| Industry | Broadline Retail | – |
| PE Ratio | 23.4 | 23.7 |
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| LTM* Revenue Growth | 12.5% | 7.3% |
| 3Y Average Annual Revenue Growth | 5.8% | 5.6% |
| Min Annual Revenue Growth Last 3Y | 1.5% | 0.8% |
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| LTM* Operating Margin | 19.6% | 18.4% |
| 3Y Average Operating Margin | 20.6% | 18.3% |
| LTM* Free Cash Flow Margin | 14.5% | 14.5% |
*LTM: Last Twelve Months
The table gives a good overview of what you get from EBAY stock, but what about the risk?
EBAY Historical Risk
EBAY isn’t immune to sharp drops. It sank about 77% in the Dot-Com Crash and nearly 75% during the Global Financial Crisis. The stock also took a 54% hit in the Inflation Shock. Even the less severe pullbacks, like 2018 and COVID, dragged it down 43% and 32% respectively. Good fundamentals matter, but EBAY shows just how deep the falls can get when panic hits.
The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.