Comments on: eBay: An Unwanted Bargain

By: Buy eBay…Wait, Sell eBay…Wait… « GigaOM

Buy eBay…Wait, Sell eBay…Wait… « GigaOM — Fri, 19 Oct 2007 05:32:41 +0000

[...] was the same dithering right after the announcement, but then investors acted as if they saw a bargain. Today’s decline may simply be investors taking profits in the face of uncertainty. eBay [...]

By: eBay: Here Come the Neighborhoods « GigaOM

eBay: Here Come the Neighborhoods « GigaOM — Wed, 10 Oct 2007 20:04:54 +0000

[...] rise to nearly $40 this morning from $32 in early August suggests they have started viewing it as a bargain with some promise. The stock is up only slightly today, but if new features could boost business [...]

By: jesus

jesus — Fri, 20 Jul 2007 02:53:30 +0000

ebay always takes a long time to load. if they improve that i would use it more as a resource. also i'd like to see them acquire amazon so we can have integration. i can go to amazon and automatically see if the item is offered on ebay. i suppose a greasemonkey user script can accomplish this, but...

By: dude

dude — Fri, 20 Jul 2007 00:09:26 +0000

well, maybe because investors are worried that the management team will take other moronic steps such as

a) not acquiring google when they had the chance, apparently under 1B

b) try to compensate for that and blow away 2.4Bn on a deal to buy a useless business like skype.

that type of lack of judgement must scare even the boldest investor

dude!

By: Spud

Spud — Thu, 19 Jul 2007 21:00:57 +0000

I'm just not sure about eBay. Maybe if there site wasn't so ugly and was given a complete facelift I might feel different and buy some shares.

By: Thursday links: bad breadth « Abnormal Returns

Thursday links: bad breadth « Abnormal Returns — Thu, 19 Jul 2007 16:28:02 +0000

[...] Kelleher at GigaOM.com asks “What is holding back eBay’s [...]

By: Jason Coleman

Jason Coleman — Thu, 19 Jul 2007 13:44:50 +0000

I own some shares of eBay because it's such a great value play. My calculations put the "sticker price" at about $84... that's a huge margin of safety compared to the current $33.30ish price.

So really great article that mimics a lot of my current thinking right now. A lot of times with value plays like this us early investors wonder when the rest of the world will catch up. We need a couple of things: (1) a major catalyst to grab folks attention and/or (2) money to invest.

RE (1), this past earnings call wasn't enough. Maybe an earnings call where they tromp the expectations will work. Maybe a Jim Cramer endorsement. It's really hard to say. I really liked the news that Google Checkout wasn't gaining as much share as people expected and how eBay was standing up to Google. (In a world where everyone sells off stock when Google puts you in their crosshairs, it's nice to see that at least someone can compete.) But that didn't have legs.

RE (2), folks are really happy with their GOOG, RIMM, BIDU, etc, etc investments right now. When they start taking profits from those, they'll need to put the money somewhere else in the tech sector. eBay will be a good choice.

We can just speculate about 1 & 2 up there, but the real reason one would invest in a value play like eBay here is that the downside is very limited. So I'm happy to tread water for a while until things get into gear. I'm thinking we'll get closer to that $84 level over the next year or two. And even now, eBay is technically still in their uptrend (above 10-day moving average, 30-day, etc).

A look at AMZN's one year chart is encouraging. Value, value, value, value, still $40, BOOM doubled in price.

On the other hand, a look at MSFT's 7-year chart is discouraging. $25-$30 forever. But MSFT wasn't really as much of a value play as eBay is here. Cheers!

By: Rick

Rick — Thu, 19 Jul 2007 13:26:04 +0000

Maybe the risk factor is the offset to the growth rate, as you implied.

Is this similar to Google's stock price? Google continues to grow rapidly, yet stock price has remained flat.

By: aidanhenry

aidanhenry — Thu, 19 Jul 2007 09:11:37 +0000

It’s all about long term investing. As Warren Buffett would say, a stock will always trend toward its intrinsic value over time – it just may take longer than you think. Markets tend to be efficient in most cases.

But then again, if you were Warren Buffett, you wouldn’t be buying tech stocks in the first place ;)

Cheers,
Aidan
http://www.MappingTheWeb.com

By: Kevin Kelleher

Kevin Kelleher — Thu, 19 Jul 2007 06:30:09 +0000

matt, I don't own any individual stocks. I invest through mutual funds and ETF's, for reasons that are too tedious to go into here. I hope my research (which some would call journalism) speaks for itself.

By: $2.4b Skype investment now worth $90m per quarter | p2p Capital Group |

Thu, 19 Jul 2007 05:55:34 +0000

[...] UPDATE: Apparently the guys over at GigaOm agree with me. Kevin Kelleher calls eBay and unwanted bargain in this article. [...]

By: matt

matt — Thu, 19 Jul 2007 04:59:27 +0000

Kevin, do you own any eBay stock? Did your research make you want to pick some up?