* Note: Prices are in Million (M) USD.
Description:
eBay Inc. is an American multinational e-commerce corporation based in San Jose, California, that facilitates consumer-to-consumer and business-to-consumer sales through its website.
These criteria used Company's Cash, EBITDA and Debt balance to determines its fair value:
Cash : $2,070 M
Debt : $7,035 M
EBITDA : $3,026 M
Net Debt (Debt - Cash): $4,965 M
Since Net Debt is covered by EBITDA within 2 years, 2 points assigned.
This criteria used industry in which company operates:
Sector: Consumer cyclical
Industry: Specialty retail
Based on industry, 3 points assigned.
This criteria used Company's Price To Earning (P/E) Ratio to determines its fair value:
Forward PE Ratio: 16.03
Since Forward PE Ratio is between 15 - 20, 3 points assigned.
This criteria used Company's ability to convert Sales into free cash flow to determine fair value:
Using last 20 overlapping fiscal years (max 20).Average Free Cash Flow: $2,390 M
Average Revenue: $9,040 M
Revenue Converted To Free Cash Flow (%): 26.4%
Since Free Cash Flow (FCF) to Revenue percentage is greater than 25, 5 points assigned.
This criteria used company's growth potential to calculate its fair value:
Latest Revenue (2024-12-31): $10,283 M
Revenue 4 Years Ago (2020-12-31): $8,894 M
Last 5 Years Average Revenue Growth: 3%
Since Revenue Growth is between 0 - 5, 1 point assigned.
This criteria used Company's ability to buy back its own share:
Latest Share Count (2024-12-31): $501 M
Share Count 5 Years Ago (2020-12-31): $718 M
Company is buying back its own shares, 3 points assigned.
This criteria used Company's dividend payout ratio to determine its fair value:
Next Year Earnings Per Share (EPS): $6.10
Trailing 12-Month Earnings Per Share (EPS): $5.48
Average Earnings Per Share (EPS): $5.79
Dividend Per Share (DPS): $1
Payout Ratio: 19%
Dividend Yield: 1%
Since company Payout Ratio is less than 50, 2 points assigned.
Since Dividend Yield is greater than 1, 1 point assigned.
This criteria used Company's Return On Equity (ROE%) to determine its fair value:
Using last 20 valid ROE years (max 20).Average ROE: 32.8%
Since Average ROE is greater than 20, 5 points assigned.
This criteria used Company's current price to its 52 week low price to determines its fair value:
Current Price: $93
52-Week Low: $54
Threshold Price (15% Above 52-Week Low): $62
Since Current price is not within 15% threshold, 0 point assigned.
This criteria used Company's Market Cap to determines its fair value:
Market Capitalization: $42,565 M
Since Market Cap is between 10B - 100B, 2 points assigned.
% Exposure to Total Portfolio
Based on the market cap, we recommend do not exceed 3% exposure of Total Portfolio.
Value-Trade has assigned 27 points to above eBay Inc (EBAY) stock.
Heads up: One or more P/E inputs look exaggerated and may skew the blend.
• ROE Based PE
36.24 (>2× median)
Further research is recommended; please use your own due diligence.In such cases, multiplying earnings by the long-run average P/E typically gives a closer, more reliable fair value.
Rule of thumb: Last 19 Years Avg P/E (15.75)
× EPS ($5.79) = $91.19.
Last 19 Years Avg PE 15.75, Fair Value PE 15, Industry Based PE 30, Growth Based PE 3, RCFC Based PE 31.15, ROE Based PE 36.24, Risk-Free Anchored PE (25% MoS) 17.08. Based on these 7 values, average assigned is 21.17. Value-Trades has assined P/E value 21.17. Since an average (Current Year EPS + Next Year EPS) earning per share is $5.79.
The fair value of eBay Inc (EBAY) stock should be (21.17 x $5.79) = $122.6.
