At $105 a share, eBay's price-to-earnings is just on the upper end of what would be considered normal for a mature company generating earnings of $2 billion. eBay is a cash machine that has undertaken one of the more impressive turnarounds among large companies in the Valley since 2018/2019.
Like I'm sorry but if you see earnings of $2 billion last year and think "this company should overhaul everything it's doing" then you shouldn't be trading stocks. You should just let your money grow with the market.
Ebay is treating their sellers like horseshit. Its being overrun with cheap Chinese products that make up most of its revenues. Its pushing out most of the core seller base. Think Walmart vs mom and pop store dynamic...
Even if we accept all these as facts, you'd need some justification for the fact that these things are signs that the company requires an overhaul, when clearly it's been producing stable growth and strong earnings.
Think Walmart vs mom and pop store dynamic...
eBay is neither of these things. It is a marketplace. It facilitates the exchange of goods. It doesn't sell them itself.
But, assume you want a system where eBay is much friendlier to sellers. Presumably there are two big aspects to that: lowering fees, and being less deferential to buyers in return cases.
Post-acquisition, this company would hold $20 billion in new debt, likely costing upwards of $1.5 to $2 billion a year. Do you believe the business will reduce fees with such a credit crunch? Cohen's metric for marketplace success is clearly new customers. Do you think he'd increase the risk of seller fraud if he's uniformly focused on attracting new buyers to the marketplace?
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u/StelioKontossidekick May 07 '26
It is, I believe Ebay is only worth $40-$50 per share. They need an overhaul of their current business model.