EBAY Company Report 2011F-11.11

EBAY Company Report 2011F-11.11 - EBAY Inc(EBAY United...

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EBAY Inc. (EBAY) United States E-Commerce/Services Price (11/10/2011) $30.54 Market Value ($mns) $39,385mns Ebay 2011 Price Earnings 20.5x S&P500 2011 Market PE (Dec.) 12.4x Company Type Industrial manufacturer/Service Valuation: 20.38$(- 33%) Model: Intrinsic Recommendation Hold Investment Thesis: Ebay (ebay) is a hold. Ebay would experience benefit from rapid growth in online sales and accelerating growth in core non- U.S. markets including Germany, Australia, and China. EBay’s business model, which requires no inventory and is not capital intensive, generates substantial free cash flow. However, fluctuations in buyer activity levels, spending levels, or other behavior patterns with respect to eBay, PayPal, and other eBay properties can hamper eBay’s growth. Fierce competition in the retail/e-commerce, online payments, and communications sectors also poses competitive threats to Ebay’s dominance. These factors contribute to the recommendation of hold with a potential to buy at $20 range. Background: EBAY, incorporated in May 1996, bring together buyers and sellers on a local, national and international basis. It provides online marketplaces for the sales of goods, services, as well as other online commerce, or ecommerce, platforms and online payment
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This note was uploaded on 11/22/2011 for the course FINANCE BUS M 409 taught by Professor Bryansudweeks during the Fall '11 term at BYU.

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EBAY Company Report 2011F-11.11 - EBAY Inc(EBAY United...

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