EBAY

[HenryTo]

Is anyone long EBAY here? Company is reporting earnings tonight. I am not optimistic mainly because of this:

http://www.marketwatch.com/news/yhoo/story.asp?source=blq/yhoo&siteid=yhoo&dist=yhoo&guid=%7BF7FFC218%2D7970%2D4224%2DA569%2DDDDD65C68D80%7D

But we will see.

[HenryTo]

Summary of the eBay analyst day - and the great emphasis on Paypal as the growth driver going forward:

http://paymentsviews.com/2009/03/11/ebay-analyst-day-paypal-world-domination/

At $15 a share, it continues to be a steal. Disclosure: I am long EBAY in my personal portfolio.

[rffrydr]

Ebay turned this one down:

http://forum.purseblog.com/up-to-the-minute/22-year-old-auctioning-off-her-virginity-354397.html

Probably because it's no auction after all....
_________________
Today is the Tomorrow you worried about Yesterday!

[rffrydr]

Another "revamp" underway:

http://www.ft.com/cms/s/0/1873480a-acdd-11dc-b51b-0000779fd2ac.html

"Quality" sellers, new front page, no feedback retribution and higher commissions.
_________________
Today is the Tomorrow you worried about Yesterday!

[HenryTo]

What happened to EBAY in the last two earnings reports:

http://www.thestreet.com/_yahoo/tech/internet/10262713.html?cm_ven=YAHOO&cm_cat=FREE&cm_ite=NA

Note that EBAY did an about-face on January 19th and then did another about-face in the next week as the price sagged.

More disappointing earnings and reaction to the April 19th report:

http://biz.yahoo.com/ap/060420/earns_ebay.html?.v=6

Option traders bracing for increased volatility after the release of the July 19th earnings report:

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20060710:MTFH35827_2006-07-10_21-51-32_N10370702&type=comktNews&rpc=44

[HenryTo]

As the rest of the world embraces more of a consumer culture, auction sites like eBay will also prosper along with it. eBay has learned its lessons in Japan and Taiwan (it has exited those two markets) and it is now getting a huge lesson in South Korea from GMarket (GMKT).

http://www.businessweek.com/globalbiz/content/jun2006/gb20060628_910393.htm?chan=tc&campaign_id=rss_tech

The question is: Can eBay stem the challenge in Korea and can it use its Asian experience to become a powerhouse in China? The news is as bad as it can get for eBay right now, but I have confidence in the long-term prospects of the company:

http://www.vnunet.com/vnunet/news/2158460/ebay-wins-china-auctions

[rffrydr]

Well the pricing structure has not gotten any better: it's its own world, community service, healthcare, awards ceremonies. But ad up fees on listing, fees on selling, fees on paypal--and then shipping. And pains like NO hands on help compounded with routine fraud and remanding fees and the like....

Today they're offering "trips to vegas" for shopping. Last month I got my first ebay "coupons"; AND you can now finance your purchase--intheory.

Tip the balance too much for Business at "Buy It Now" and they will start to go away. Lotteries are desperation. Many of their world sites are dysfunctional. Govt. regs et. al. But mainly culture. In Hong Kong they don't have a used market!

But now with Yahoo, and at the right price....

[HenryTo]

A very interesting article on the eBay German market. Quote: The relatively slow growth rates of eBay's Germany operations may indicate that the unit is ailing, but that's not quite the case. While some analysts attribute a small part of the slowdown to Germany's sluggish economy, the biggest factor is that eBay Germany is a victim of its own early success.

German Internet users took to eBay faster than people in other countries where eBay has a sizable business. After 16 months, the gross merchandise value of eBay Germany was nearly $15 billion, or more than twice as large as eBay's U.S. operations were at a comparable point in its history. eBay has been voted the top brand in Germany for five straight years, so it's not as if people are dissatisfied with the company.

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Kevin Kelleher
eBay's Elusive German Growth
By Kevin Kelleher
TheStreet.com Senior Writer
5/23/2005 8:00 AM EDT
URL: http://www.thestreet.com/tech/kevinkelleher/10224711.html

In the long term, eBay's (EBAY:Nasdaq) growth may come from emerging markets such as China and India, but it's the near-term growth in markets like Germany that is causing more of a problem right now.

eBay CEO Meg Whitman said last week that the company expects China to become one of its biggest markets in five or 10 years. That would be nice, but this year eBay's marketplace business in China will yield only $400 million, or a little more than 1% of its total gross merchandise value last year.

And investors have this nasty habit of being short-sighted about revenue and profit figures, so for the moment, they're watching Germany much closer than China. eBay's German operations have been a drag on its overall auction and e-commerce business and Whitman and others at eBay have admitted they'd like to see growth rates improve.

eBay's German problem is about more than jump-starting one of its core markets; it's a chance to prove that the company can still manage impressive growth rates, even as it brings in more than $3 billion a year in revenue. Investors and analysts watching eBay have worried that the 10-year-old company has hit middle age already. eBay's estimated 2005 EPS is 45 times its price -- a valuation that isn't bad for a company growing at a healthy rate, but a rich one for a mature company.

Germany accounted for 22% of the total value of goods sold through eBay's marketplace last year, second only to the U.S. in size, but its revenue growth rates have been lower than most of the company's other markets. In the first quarter of 2005, eBay's Germany revenue grew 24%, but factoring out the purchase of automobile marketplace site mobile.de, revenue grew 16%. That was less than a third as fast as the 51% growth rate of eBay's international marketplace revenue.

A year before, in the first quarter of 2004, eBay's international marketplace revenue was growing at an 87% rate. So, growth at its international markets are slowing despite successful launches in countries like France, the U.K. and Italy. About half of eBay's European revenue comes from Germany.

In the past two quarters, analysts have hammered on the relatively slow growth in Germany. eBay executives were quick to respond by focusing on initiatives to spur growth and carve out a bigger piece of the e-commerce market there.

Addressing analysts, Whitman has said that eBay has "considered things like loyalty points, we have considered things like education, we have focused on direct marketing and site merchandising and we're going to pull those levers."

More recently, eBay has pushed cross-promotions with mobile.de. In April, the company introduced a site tailored to businesses in Germany. "It's going to take some time before those initiatives start to take effect," says eBay spokesman Hani Durzy.

How is Germany doing this quarter? eBay, of course, won't give out information on revenue, but many analysts track listings on its sites around the world to get a sense of how things are going. Halfway through the second quarter, reports are mixed, but there aren't yet clear signs that eBay's efforts are taking root.

Deutsche Bank analyst Jeetil Patel estimates that eBay Germany's listings are up 9% so far in the second quarter, including a strong promotion eBay offered in early May. He estimates listings for the full quarter will be "flat to modestly down" from last year. Deutsche Bank has an underwriting relationship with eBay.

Prudential analyst Mark Rowen says German listings grew a more modest 1.8% so far this quarter. And he notes that the rate was substantially slower than the 20.8% rise in U.S. listings, where eBay also staged a promotional effort, or the 117.7% surge in U.K. listings. Prudential does not have an underwriting relationship with eBay.

The relatively slow growth rates of eBay's Germany operations may indicate that the unit is ailing, but that's not quite the case. While some analysts attribute a small part of the slowdown to Germany's sluggish economy, the biggest factor is that eBay Germany is a victim of its own early success.

German Internet users took to eBay faster than people in other countries where eBay has a sizable business. After 16 months, the gross merchandise value of eBay Germany was nearly $15 billion, or more than twice as large as eBay's U.S. operations were at a comparable point in its history. eBay has been voted the top brand in Germany for five straight years, so it's not as if people are dissatisfied with the company.

And even with its slower growth rate, eBay's German customers buy and sell relatively more than those in its biggest market, the U.S. Last year, the amount of goods traded on eBay was equal to $93 per capita in Germany, well above the $61 figure for the U.S.

Hellen Omwando, an analyst at Forrester Research, says price-conscious German shoppers have helped drive eBay's success. "Twice as many online German shoppers as online U.K. shoppers buy from online auctions."

So, Germans still love eBay, but that makes it all the more puzzling that listings and trading continue to grow at a slower rate than one would expect. eBay often says there's still a lot of room to grow in Germany. Its efforts to make that happen sooner or later could pick up steam in coming quarters, but how long investors are willing to wait for results is another question.

[nodoodahs]

EBAY got game, great fundamentals, I will assume the FCF deficit of recent times is related to rising [intangibles/assets] ratio from acquisitions. A fine company.

You could GIVE it to me at this price and I'd sell. I would look at EBAY somewhere around $12 as a bargain. I would never be long something with EBAYs current multiples, no amount of math can justify 60x earnings. I am a bottom fisher, though, and I go "long" anticipating holding for one year plus, so EBAY not for me.

[HenryTo]

This just in - ebay is continuing to exert its dominance all over the world - this time in Europe and in Australasia. Note my above message on April 22nd - ebay closed at $31.51 that day. I still think ebay has more room to run here.
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EBay Acquires Two Classified Site
May 19, 2005

EBay Inc. acquired two classified-ad Web sites operating overseas in an effort to expand the reach of its Kijiji international classifieds group. The San Jose, Calif., Internet auctioneer said it bought Gumtree.com and Loquo.com for an undisclosed amount. EBay doesn't expect the transactions to have a material effect on earnings and revenue for 2005. London-based Gumtree, which lists apartment rentals and jobs as well as other goods and services, is available in the U.K., Australia, New Zealand and South Africa. Loquo is a classifieds site in Spain and other European countries.

[HenryTo]

From the WSJ this morning. FWIW, I don't think Overstock is a worthy competitor to EBAY at all:

"Overstock.com shares fell $2.27, or 6%, to $35.73 on Nasdaq after the online discount retailer's first-quarter loss widened as marketing costs nearly quadrupled and administrative expenses almost doubled.

"While revenues were solid once again, we believe the continued rise in spending, in both marketing and G&A costs, will continue to be a concern for investors and weigh on shares today," Piper Jaffray analyst Aaron Kessler wrote in a research note on Overstock."

[HenryTo]

I think there is a chance that EBAY may have bottomed here. Unlike GOOG, I really don't think they have a much of a formidable competition in the B2C or C2C online auction space. Overstock certainly does not come close.
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eBay Launches Service for Poland
Friday April 22, 6:00 am ET

SAN JOSE, Calif.--(BUSINESS WIRE)--April 22, 2005--eBay (Nasdaq:EBAY - News), the World's Online Marketplace, today announced the launch of eBay Poland (www.ebay.pl), a new website in Poland where buyers and sellers can meet and trade. The service aims to build a vibrant local trading community and help grow e-commerce in Poland.
The website offers online trading in Polish with item prices listed in the Polish zloty. Individuals and small businesses in Poland can list and sell goods and services on the site at no charge. In addition to local trade, eBay Poland users have access to eBay's global marketplace.

"We are pleased to expand our footprint into Eastern Europe and bring new opportunities to a growing community of e-commerce users," said Matt Bannick, president of eBay International. "Many thousands of people in Poland are already using eBay, and we look forward to working with them to build their own dedicated website."

While still in the early stages, online shopping in Poland is expanding at a rapid pace. The country's business-to-consumer e-commerce is expected to grow nearly 400 percent over the next three years, from $319 million to $1.2 billion, according to IDC's Internet Commerce Model (January 2004).

[HenryTo]

EBAY off a little bit in pre-market trading this morning. Sorry - but I don't have a subscription to realmoney.com:

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Disney's CEO Search Bodes Ill for eBay

By James Cramer

About this article:
Now that Disney has a new CEO, we've learned that eBay leader Meg Whitman was trying for Eisner's spot for a while. James J. Cramer believes that her possible departure to a similar-sized company says that perhaps she doesn't believe eBay should be a $50 billion company. Take your cues here: eBay has lost its luster...

[HenryTo]

From Forbes:

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EBay Hurt By Uncertainty, Negative Sentiment
03.08.05, 10:30 AM ET

Standard & Poor's Equity Research reiterated a "hold" rating on eBay (nasdaq: EBAY - news - people ), citing two recent negative reports on the company. One report noted that 7,000 eBay stores have closed since the mid-February fee increases, but S&P Equity Research estimates year-to-date closures "at some three to four times this amount." Another report focused on eBay's vulnerability to "phishing" scams, where users are tricked into providing personal information such as passwords and credit card information. The research firm said, "Given notable uncertainty and negative sentiment, we remain 'neutral' on eBay."