I entered eBay back in November around $22 a share using dollar cost averaging to build a sizable stake. Now I’m currently sitting on a 27% gain wondering just how far eBay shares will run before the year’s end.
Back in early November, I wrote an eBay Stock Series that analyzes the company’s 3 core assets: eBay, Paypal, and Skype. I’m still confident that eBay has yet to fully monetize these holdings, so expect shares to continue to increase in value.
The holiday season will also be a strong indicator of eBay’s internet shopping market share, and if eBay.com can outperform competitors like Amazon.com and Buy.com, then the market should respond accordingly and send the shares upwards.
Moving to eBay’s communications company, Skype released a paid unlimited phone calling plan, which allows customers to make as many calls to US & Canada during a 12-month fixed period. This should win new subscribers who prefer the low fees of making calls via the internet.
eBay is certainly risking potential profits by offering unlimited calling plans, but we will see what happens. There has been some negative talk floating around the market, especially from short term traders who bash the stock.
I found this post under eBay’s Yahoo! Message Board section, which clearly expresses short-term negative sentiments about eBay stock.
Regardless whether eBay jumps a buck or two (doubtful) or it falls a few bucks (more likely) eBay’s fate is sealed because it allowed actual investors to see its true weakness in this, its supposed peak selling season. eBay flopped pretty badly.
It was obvious. It was public. And you know investors saw it clear as day! Now it will take awhile for the institutions to put it together and react, it may take awhile for the retail small time investors to react, after all this is their long term favorite bubble stock, but real investors saw that after all the promises, all the risky purchases, all the needless site changes, and after all the hype:
eBay completely stalled out between $33 and $31 at its peak Christmas selling season. If it can’t grow significantly at this quarter, it NEVER will. eBay is sending a clear signal that it is a spent and exhausted force. A done stock.
We ALL witnessed it. We all saw it.
Actual investors especially did.
And that’s just the way it is!! !!
This investor is clearly a short term trader because he lets one holiday season determine the long term course of a stock. That’s a huge no-no. Holiday sales trends are indicators. It’s just another statistic that gives the day traders something to squawk about. We investors solely care about free cash flow, earnings growth, and return on our investment.
As a eBay shareholder, my biggest concern is the company’s long term performance because short term trends are what day traders use to examine stocks. We long term investors like to see constant forward growth, supported by strong valuation and large cash holdings.
As long as eBay continues to deliver these key elements, I will continue to hold their stock because we care about results, not short-term indicators.
Ebay and Paypal business practices need to be really examined. Paypal routinely freezes customer’s accounts for up to 180 days . Ebay puts on thousands of training Ebay classes at local colleges to entice average people to sell products on Ebay. Many companies sell products to these people to sell on Ebay. Many people quit their job, take out second mortgages out on their homes to finance the widget they want to sell on Ebay. Little do they know that they can have their account suspended in one hour, one day one month etc and their Ebay business is history. Ebay buyers and sellers are mere pawns that are used to drive the price of Ebay’s stock up. Has the hurricane Ebay hit your Virtual Store yet? If it has not, it’s just a matter of of time! When it does your business is history in an instant. Ebay destroys thousand of on-line Ebay business monthly. They are not easy to contact. They send Web Form letters that have nothing to do with your enquiries when you get suspended. Most Ebay departments cannot be reached by phone. If you make too many phone calls for example that is a sure way to have your account suspended for life. It is all about the price of their stock, screw the customers buyer s and sellers alike!. Paypal and Ebay share information that they use against their buyers and sellers. Type in “Suspended Account EBAY” on Google and you will see thousands of people on various websites that have been destroyed by Ebay. The institutional investors really need to think twice before investing in an of Ebay’s companies. They are currently involved in a battle as a result of violating three out of four patents that belong to MercExchange for “Buy It Now”
See http://en.wikipedia.org/wiki/EBay_v._MercExchange
They thought they could out spend this company and dragged this company all the way to the Supreme Court. A very large Class Action Suit is just a matter of time before Ebay is worth nothing. Please think twice before investing in any Ebay owned company. When will CNN, 60 Minutes or FOX do an investigation on Ebay and Paypal? Who will be the first to blow the lid on this unscrupulous company? They need to be stopped.
If you think eBay will get things together anytime soon check out the live help conversation about buying eBay stock with paypal and buyer protection if stock tanks.