Top Bulls Reasons To Buy — Vote below!

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Company: EBay (EBAY)
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75%
agree
8 votes

  Monopolies (with inflation protection) in TWO markets, not just one

Monopoly #1 is in online auctions. EBay owns the market, and no competitor has ever been able to even become a blip on eBay's radar. It's a textbook example of the power of the network effect. Despite having had a disaster of a CEO in Meg Whitman and a so-so CEO in John Donahoe, eBay has a very wide moat in online auctions, and that won't change for the foreseeable future. Even the privately held Craigslist, which is a competitor in the "Time-To-Clean-Out-My-Closet-And-Sell-This-Junk-Online" market, is about a quarter-owned by eBay, so they get a piece of that action too.

Monopoly #2 is PayPal. If you're a small company or entrepreneur doing business online, it can be prohibitively expensive and complicated to get a merchant account, plus having the merchant account won't enable you to do business globally and in several currencies. But PayPal solves all of that for you. Plus PayPal has the aforementioned network effect, in which case no competitor can hope to ever match its user base, which creates a moat. PayPal gets a little piece of the action all over the world in ecommerce.

Since eBay charges auction fees and PayPal fees *mostly* as a percentage, this gives it built-in inflation protection that is better than 90% of the other businesses out there have.

In conclusion, eBay has an extremely solid business model. Although its R&D and SG&A expenses are a bit high, and its CEOs have been way too feverish about over-paying for acquisitions with the shareholders' cash, it's the power of its business model that is making eBay a winner in the long run.

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52%
agree
17 votes

  Upside to the eBay Story

The company is one of the most well-known and popular names throughout many parts of the world and has built a rock-solid brand. Ease of use, an extremely diverse range of products, and efforts to boost customer interaction translates to customer loyalty and a lot of repeat business.

Over the years, the company’s robust business model has resulted in some outstanding gains for investors as a high-growth play on events like the Christmas shopping season and as a stock that offers protection during tougher times.

Its strong cash flow (almost $3 billion over the past 12 months) has provided security for shareholders, as has the management policy of consistently initiating large share buybacks in the event of downturns, returning this cash flow to investors. These buybacks prevented dilution from management stock option grants, but also supported the stock price.

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40%
agree
20 votes

  PayPal

PayPal's dominance in the online payment services market, and its integration with eBay, Skype, and other services, will help the company further monetize its properties.

PayPal is currently seeking to obtain a Banking license which will only help PayPal's growth and integration into the financial services.

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22%
agree
9 votes

  Expansion abroad due to depressed USD

With just over $4 billion swimming around in eBay’s bank account (and a further $2.3 billion in cash projected by the end of the year), the company plans to use it to fuel its overseas expansion - not a bad policy, given the depressed U.S. dollar. The firm just announced that it will spend $404 million to buy a stake in South Korean e-commerce company Gmarket. Pending approval from the authorities, this would not only help eBay expand in the busy Asian market, but also eat into some of the market share that Yahoo! (Nasdaq: YHOO) has built through its 40% holding in Alibaba Group and 10% share in Gmarket in 2006.

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25%
agree
12 votes

  Crisis Sale

Economic crisis will force consumers to sell

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23%
agree
13 votes

  Great auxillary applications and tools

They got one of the most famous social bookmarking system, Stumble Upon and Skype.

Skype has a large and passionate fan base and is well positioned to take advantage of the new and evolving VoIP market. If "free" wi fi / white space is approved by the gov't, skype might just be the next "Tmobile", Verizon. That's a long shot but who knows.

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44%
agree
65 votes

  The Prostore effect

eBay's new management team has already broken one "sacred wall" with the announcement of category based pricing in media and it is clear to me that they want to make eBay.com a shopping portal, rather than strictly a shopping destination. So why not break another “sacred wall” and give sellers the ability to actually grow and build an online brand? In this scenario, eBay would be able to maintain their fee structure in each of their advertising venues (e.g CORE, PIF, Shopping.com, Sponsored Ads, Classifieds, etc.) and they would give ProStore sellers the ability to maximize their advertising dollars by building a brand and developing long-term relationships with their customers.

Once the ProStore seller has done business with a customer, it is up to them to work diligently to get them to return to their ProStore, where there is a minimal FVF and a fixed hosting fee. This gives ProStore sellers a huge advantage over any other webstore platforms (e.g Yahoo Stores, Amazon WebStore (AMZN), eCrater, Volusion, etc.) and sellers can finally gain a little control over their marketing expenses and their business. Most eBay sellers do not want to leave eBay, they just want to sell products and they are willing to pay eBay for the traffic, they just want to control their business. eBay management has the ability to make this happen right now and keep competition at bay

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10%
agree
10 votes

  EBAY's latest strategies might just be working

In a sign that efforts to overhaul its main auction and fixed-price retail site may be working, EBay Inc. (EBAY) reported sales and profit that beat analysts’ estimates, Bloomberg reported. The most-visited U.S. e-commerce site said net income was $357.1 million, or 28 cents a share, compared with $459.7 million, or 34 cents, a year earlier. Excluding some items, earnings were 39 cents a share, beating the 34-cent estimate by analysts.

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16%
agree
12 votes

  eBay Takes Initiative Again

eBay users are excited about at least one of the new moves the company has promised: Paypal development.

For those of you like me who’ve only ever ventured onto eBay once or twice, PayPal according to its own website “can be used to send and receive payments through the internet. Once you sign up for a PayPal account, you can send and receive money online. When you send money, you can choose to fund your payments from your PayPal account balance, a credit card, or your bank account. Recipients are then notified via an email from PayPal that they have received payment from you.”

So in short, it’s a safer way of paying online.

Hoping to remake the company, Chief Executive John Donahoe said that changes were well overdue while PayPal President Scott Thompson informed the public that he sees the online payments arm doubling its business over the next two years.

Together, they plan to open PayPal usage to the larger community of application developers. That means that trendy tech devices such as Blackberry will be able to adapt the program to its own specifications.

“We believe it will be bigger than marketplaces because its target audience is all of e-commerce,” Donahoe predicted. “The core eBay business must change and it will.”

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