Ebay Financial Analysis

Topics: Financial ratio, EBay, 1973 Pages: 11 (2297 words) Published: May 6, 2013

BUAD 341.00, MWF 11:00A


May 3, 2013

Table of Contents



Product Line of the Company3

Industry History and Analysis3

Major Competitors4

NAICS Numbers4

Relative Sales4

Relative Returns5

Product Life Cycle5

Stock Performance6

Financial Analysis7

Ratio Analysis8

Pro forma8


Growth Rate of Sales9

Asset Acquisitions9

Financing Needs9



Income Statement10



Firm Ratios16

Industry Ratios17

Graphs of Ratios18

Graphs of Ratios19



This paper will provide a historical analysis for EBay, who operates the world’s largest online trading community. The analysis will show EBay’s main competitors and assuming the historical trend persists, I will be able to generate a three year forecast that will explain the company’s ever rising financial situation and steady outlook as a leader of its industry.


EBay operates the world’s largest online trading community. As of the end of 2012, their marketplaces’ segment had over 110 million users. EBay is concentrating on making their user base even larger. eBay has been able to correctly predict the increases in the current and future markets for their Marketplaces segments and payments business (PayPal) showing substantial growth for their online ecommerce industry. Although EBay bottomed in 2009, reflecting the economic difficulties, notable retooling of and investment in the core marketplaces businesses across the world and less favorable revenue mix. It is noted that a negative impact from its acquisition in 2012 and definitely foresee annual improvements in 2013 through 2015. In the past several years, eBay has shown increases in all areas of their business.[1]

History of the Firm

In 1995 on Labor Day, Pierre Omidyar, the founder of EBay wrote the code for what he called an “experiment”. He questioned, “What would happen if the world could have equal access to a single global marketplace.[2] In his experiment, Pierre Omidyar, tested the new auction website with a post, and waited. He was surprised to have sold a broken laser pointer. This was the beginning of a radical transformation in e-commerce. EBay has continued to escalate their business domestically and internationally during the past years. The company has become the world’s largest operating online trading community. The company’s stated goal is to become the world’s most efficient and abundant marketplace by expanding its community of users, delivering value to buyers and sellers, creating a global marketplace, and providing faster, easier and safer trading experience. The company has increasingly employed acquisitions to fulfill the aforementioned goal, focusing on international expansion and offering more choices and services to its buyers and sellers. EBay’s innovative way of doing business has brought the company the success it has today. EBay will continue to employ its financial resources to seize upon sizable opportunities in international markets as well as domestic markets.[3]

Product Line of the Company

EBay pride themselves as being one of the world’s most popular e-commerce destinations, which bears its name, as well as PayPal (an online payments business) and other online interests. EBay is a remarkably efficient market created by connecting individuals who wouldn’t otherwise be connected. It was substantially the world’s first example of online social networking. EBay’s presence in more than 39 markets including partnerships and investments with more than 110 million users worldwide, trading more than $1,900 worth of goods per second.[4]

Industry History and Analysis

The industry for EBay has done well...

Bibliography: 1. Hoover 's.com. (2001, 1 January). Retrieved February 15, 2013, from Hoovers: http://www.lexisnexis.com.navigator-millersville.passhe.edu/hottopics/lnacademic/?shr=t&sfi=AC02NBCmpDosSrch
3. EBay Historical Prices. (2008, December 31). Retrieved April 5, 2013, from Yahoo Finance: https://www.google.com/finance?q=NASDAQ%3AEBAY&ei=zdSFUdjHJKbSlgPZZg
5. Bureau of Economic Analysis. (2012, September 15). Retrieved March 4, 2013, from BEA.gov: http://www.bea.gov/azindex/index.htm
7. Edgar. (2012, September 19). Retrieved March 5, 2013, from US Securities and Exhange Commission: http://www.sec.gov/cgi-bin/browse-edgar?company=eBay&match=&CIK=&filenum=&State=&Country=&SIC=&owner=exclude&Find=Find+Companies&action=getcompany
9. YCharts. (2012, December 31). Retrieved March 24, 2013, from ycharts.com: http://ycharts.com/companies/EBAY
11. Financial Information for EBAY. (2013, January 1). Retrieved May 5, 2013, from Reuters.com: http://www.reuters.com/finance/global-market-data
13. Leo, T. (1997, March 15). Almanac of Business and Industrial financial ratios. Almanac of Business and Industrial financial ratios, p. 236.
14. Stepehen A. Ross, R. W. (2010). Fundamental of Corporate Finance. In R. W. Stepehen A. Ross, & Ninth (Ed.), Fundamental of Corporate Finance (pp. 50-65). New York, NY, US: McGraw Hill Irwin.
[2] Standard and Poors Industry. (2006, August 24). Retrieved March 10, 2013, from S&P.com: http://finance.yahoo.com/q/hp?s=EBAY&a=11&b=31&c=2008&d=11&e=31&f=2012&g=m
[3] Hoover 's.com
[6] Bureau of Economic Analysis. (2012, September 15). Retrieved March 4, 2013, from BEA.gov: http://www.bea.gov/azindex/index.htm.
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • General Electric Company Financial Analysis Essay
  • Financial Performance Review and Objective Essay
  • conclusion to financial statement Essay
  • Comparative Analysis of Neepco Through Ratio Analysisgh Ratio Analy Essay
  • Essay about Financial Statement Analysis
  • Financial Ratio Definition Essay
  • Ratio Analysis Essay
  • Ratio Analysis Essay

Become a StudyMode Member

Sign Up - It's Free