| Valuation method | Value, £ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | n/a | n/a |
| Intrinsic value (DCF) | n/a | |
| Graham-Dodd Method | 4.30 | -95 |
| Graham Formula | 29.30 | -68 |
eBay Inc. is a global e-commerce leader operating a dynamic online marketplace that connects buyers and sellers across the United States and internationally. Founded in 1995 and headquartered in San Jose, California, eBay's platform includes its flagship website, eBay.com, and a suite of mobile apps, facilitating transactions for a diverse range of products. The company serves a broad spectrum of commerce participants, from individual sellers to large retailers, distributors, and liquidators. eBay's business model thrives on its ability to provide a seamless, multi-channel shopping experience, leveraging online, mobile, and offline touchpoints. As a key player in the Specialty Retail sector within the Consumer Cyclical industry, eBay continues to innovate in digital commerce, offering secure payment solutions and a robust ecosystem for global trade. With a market capitalization exceeding $33 billion, eBay remains a significant force in the competitive e-commerce landscape.
eBay presents a mixed investment profile with notable strengths and risks. The company's strong brand recognition, global reach, and consistent revenue stream ($10.28 billion in FY 2023) underscore its resilience in the e-commerce sector. Its profitability, with a net income of $1.98 billion and diluted EPS of $3.94, reflects efficient operations. However, eBay faces intense competition from larger players like Amazon and emerging platforms, which could pressure growth. The company's beta of 1.31 indicates higher volatility relative to the market, suggesting sensitivity to economic cycles. Investors may find appeal in eBay's dividend yield (approximately 1.04% per share) and solid operating cash flow ($2.41 billion), but should weigh these against its substantial total debt ($7.86 billion) and the challenges of maintaining market share in a rapidly evolving digital commerce environment.
eBay occupies a unique niche in the e-commerce ecosystem, differentiating itself through its auction-style listings and a strong focus on collectibles, refurbished goods, and niche product categories. Unlike Amazon's first-party retail model, eBay operates primarily as a marketplace, connecting buyers and sellers without holding inventory. This asset-light approach allows for higher margins but limits control over the customer experience. eBay's competitive advantage lies in its established user base, global platform, and reputation for rare or hard-to-find items. However, the company struggles to compete with Amazon's logistics network, fast shipping options, and Prime membership benefits. eBay's payment system modernization (managed payments) has improved transaction efficiency but still lags behind the seamless checkout experiences offered by competitors. The company's mobile app and user interface have seen improvements, yet they often trail the more intuitive designs of newer marketplaces like Etsy or Poshmark. eBay's scale provides cost advantages in customer acquisition, but its growth rate remains subdued compared to sector leaders, reflecting challenges in attracting younger demographics and high-volume sellers.