Among the stock exchanges on which you can invest today, some names are certainly known and enjoy strong popularity. This is the case of the eBay company whose securities are highly sought after by private investors due to their strong liquidity and their profitability.
If you also want to invest on eBay shares here are some explanations on the company of the same name and advice to carry out analyzes and follow the listing of its shares on the Stock Exchange. eBay has become synonymous with online auction and sale, the platform is in fact developed on the possibility of buying and selling new or used products between individuals or between commercial and private businesses. The business model of this company is based on the levy of a commission on each transaction made online in return for the visibility provided by the site and the tools made available to the sellers who use it, such as secure payment methods. It has 300 million users in the world with an operating cash flow that stands at an average of 2 billion dollars.
Activities of the eBay company
The eBay company is one of the big names in the US economy and was launched in 1995 by Pierre Omidyar. Basically it is an auction site that is today the market leader with almost 300 million users worldwide.
The business model of this company is based on the levy of a commission on each transaction made online in return for the visibility provided by the site and the tools made available to the sellers who use it, such as secure payment methods.
eBay Inc. entered the Italian market six years later, in 2001, occupying the space detected by the iBazar website on the web.
Unlike the classic e-commerce sites, the activity of the eBay company is characterized by the availability of fixed-price or variable-price products.
At the beginning of the sale of the online auction, where buyers make a price proposal to win the product, several purchase methods have been added, such as the possibility of direct purchase or preliminary contact with the seller.
All transactions are carried by compulsory and free registration on the eBay website. Registering with the site allows the user to be both a seller and a buyer.
To be qualified as a seller, simply enter a verification code that the eBay company sends to the user’s home or business, or by checking the codes of an accredited payment system (credit card or prepaid card) ).
The seller is responsible for the insertion of the announcement that those relating to the final price of the product sold.
History of the eBay company
To better understand the historical evolution of eBay stock prices it is interesting to know some significant dates and facts, of which here are the main ones.
We start from the origins. eBay was born as a personal site section of the programmer Pierre Omidvar, we are in San Jose, California in 1995.
Pierre Omidvar sold a broken laser pointer purchased at a price of $ 14.83 from a user. Amazed at the unexpected success of that economic transaction, he informed himself on the real awareness of having bought a non-functioning product.
However, the user confirmed his interest: he collected broken laser pointers.
This was the beginning of the eBay company. The story that led eBay to be a publicly traded company is from now on a history of winning moves.
In 1996 the establishment of the company: the first employee and the first president: Jeffrey Skoll.
Following the agreement with the Electronic Travel Auction to use the marketplace for the sale of tickets, the first name of the company is AuctionWeb, but in 1997 the official name becomes eBay and the domain name that will become popular all over the world is registered : www.ebay.com
1998. The site is online, the climb to success begins. Under the administration of Meg Whitman eBay becomes a leader in the e-commerce market, creating new development scenarios for e-commerce.
At the end of the 90s the company reached other big names in the field of new technologies such as Yahoo or Amazon, profiting from an important stock market capitalization. Unfortunately, it will still suffer the crash caused by the explosion of this bubble.
In 2001 it acquired the French company, already present in the European market, iBazar S.A., with this transaction eBay arrives also in Italy.
In 2002 eBay bought the PayPal electronic payment system and in 2005 bought the Skype VoIP system from Microsoft.
In 2007, only in Italy there are 5 million registered users.
From 2007 to 2008 eBay generates a turnover of no less than 1.7 billion dollars in a year and will not stop progressing ever since.
The main competitors of eBay
Although the eBay group is without a doubt one of the pioneers of online sales between individuals, over time it has developed other B2C activities and is now facing competition from many companies around the world, some of which threaten it directly. To find out more about this international competition and to better narrow down this market and its challenges, here is the list of companies directly competing with eBay in the world.
Amazon.com Inc, which is the main competitor of Ebay.
Wal-Mart Stores, Inc.
Sears Holdings Corporation
J.C. Penney Company, Inc.
Costco Wholesale Corporation
Office Depot Inc
Home Shopping Network
Lotte Shopping Company Limited
Disadvantages and weaknesses of eBay shares as an active market
The eBay group has, as we have seen in detail, several large forces that should enable it to develop growth and profitability for years to come. However, you need to take the time to reflect before making any decisions about the rise in this stock because the eBay group also has weaknesses. These weak points, even if less numerous than the above mentioned strengths, still weigh relatively strongly in the scale and must therefore be known by all traders. Here are the main weaknesses of this company.
First of all, although the eBay group works from the beginning on the model of a scale strategy, over time its costs are getting higher and higher. This is due to the fact that the group must face increasingly aggressive competition and must therefore prove even more ingenious to offer increasingly innovative and attractive services to potential customers.
On the other hand, most of the investors on the stock exchange who are interested in these actions regret the total absence of a growth strategy by the eBay company. In fact, the management of the group only rarely communicates about the elements put in place in order to develop its own activities and few figures related to the objectives are made public.
How to achieve a good fundamental analysis of the listing of eBay shares
Let’s find out now the opportunities and threats that arise for the future of eBay and that are just as many elements to consider when making a fundamental analysis of this title.
With regard to growth opportunities, eBay could in particular profit from the growing number of mobile customers in the world thanks to its mobile application and payment system that perfectly adapts to these modern supports, which are smartphones. Since most purchases already take place on eBay mobile devices it should be one of the companies that will make the most of it.
Again with regard to opportunities, eBay is about to become a retail trader. Thanks to its gigantic customer base, it obviously has all the necessary advantages to succeed in this sector and far surpasses other specialized retailers.
eBay also aims at a medium and long-term purchase strategy of various companies to propose a wider range of services. Therefore, operations of this type and joint venture creations are events to be followed closely.
Finally, eBay also seeks to position itself in emerging markets by developing its online business in promising countries such as India as well as in several European countries.
As for the threats, given that the company is a privileged target for hackers, the online security of the personal information of the group’s customers, including bank details that are particularly sensitive, will obviously be followed.
The eBay group will also have to face ever-increasing competition from local retailers who generally offer lower-priced items, especially thanks to a lower transportation cost, and better knowledge of the market. Among other things, the competition of the giant Amazon remains very aggressive and for some years this opponent takes more and more market shares.
Finally, exchange rates and their variations are a further important brake to the growth of eBay because the group carries out a large part of its operations abroad. For this reason, profits that arrive in the US are converted into dollars and this can cause losses