Established in 1995, eBay is now the world’s most popular online auction site. Founder Pierre Omidyar actually set up the company when he needed to sell some of his own personal belongings. At that time, the business went under the name of AuctionWeb. It was the success of this initial endeavour that prompted him to go on and establish the business. eBay first released shares to the public back in 1998, and it now produces annual revenues in the 9-billion-dollar bracket. This income is generated through the fees that the site charges for listing users’ items for sale.
eBay has displayed an aggressive expansion policy by buying up many of its competitors to take advantage of their evolving technologies. Such companies already include Craigslist, Half.com, and the payment processing giant PayPal. It also purchased Skype and later resold it to the Microsoft Corporation. PayPal now also operates as a standalone entity, though eBay uses it to process payments.
Along with its headquarters in San Jose, California, eBay also has branches in different countries including the Philippines, Australia, India, Singapore, and the UK. One of its biggest assets is eBay Motors which sells thousands of vehicles through the online portal. eBay employs a workforce of 12,000 and looks set to continue expanding.
While the auction site has made inroads all over the world, New Zealand and China are yet to be penetrated, as both countries already have fiercely-protected local businesses fulfilling the niche.
- During its IPO, eBay offered its share price at $18.00. The price almost tripled to a staggering $53.50 at the end of the first day of trading. Since then, the value of the stock continues to outperform the S&P 500 average. This has been taken as a measurement over 3, 5, and 10 years up to recent times. It should be noted, though, that the company achieved this outstanding performance while it still held PayPal.
- eBay is under increased pressure from market giants Walmart and Amazon. With both main competitors enjoying a 60% growth rate per quarter, eBay is bound to be feeling the pinch already. The company is, however, currently able to enjoy the benefit of saving on taxes because it has no physical storage spaces.
- eBay has plans to expand its international sales and to move into additional sectors through its holding in StubHub to utilise platforms, ticket sales, and classified ads. As these areas have already been seen to achieve a 15% growth rate, it is envisaged that such a move could be beneficial to the company.
- In an interesting turn of events, a recent EU ruling against the search engine giant Google is also likely to put more buying traffic on eBay’s virtual doorstep.
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