Future growth opportunities lie ahead of eBay. eBays fundamentals are no slouch either; in fact, top line revenue grew from $3.3 billion to 2004 to $4.6 billion in 2005. This years revenue estimates project revenues of $5.7 to $5.9 billion. eBay also sports the following numbers:
- 11% 2nd quarter 2006 earnings growth – an increase since last quarter’s negative 10% earnings growth rate. eBay’s is surviving its 1st quarter descend.
- 86% 5 years sales growth rate – eBay’s five year sales growth is nearly triple the industry average for the same duration.
- $2.4 billion in cash – you’ve got to appreciate “cash cows”, ya know, companies that make tons of money. eBay’s pockets are pretty loaded going into the 4th quarter.
- 0 years with negative EPS – eBay finished in the black in every year of operation.
- $0 debt – eBay is absent of any debt.
There’s a bright future ahead for eBay as long as they maintain their competitive edge on the online shopping industry, where the eBay.com marketplace fully thrives.
Paypal and Skype are both burgeoning businesses but owning shares of eBay stock is more like investing in Paypal because that’s where eBay can cash in. If successful at building the Paypal brand name, Paypal will pay for itself, and you can view Skype and eBay as added incentive to hold the stock.
If you enjoyed this series, Subscribe to the Investor Trip Newsletter.