eBay Doubles Down On Mobile

PayPal, the online payment juggernaut, has been the single greatest growth driver for E-commerce giant eBay (NASDAQ: EBAY  ) for the last several years.

In the last five years alone, revenue from eBay's PayPal has compounded at an average rate of 18% annually. PayPal's overriding success in the booming industry for online payments has clearly been a major contributor to eBay's outstanding performance. Looking at the last 5 years, eBay's shares have surged 260%, handily trouncing the Nasdaq's 164% gain during the same time frame.

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The best is yet to come
Although this run has been impressive for both companies in question here, there's plenty left in the tank at PayPal to help fuel eBay's returns for years to come.

One particularly interesting area of opportunity for PayPal and eBay is mobile. In just the latest example to date, over the Thanksgiving holiday, PayPal noted an impressive 114% spike in mobile payments compared to the year prior.

As you can imagine, PayPal, and eBay by extension, are laser focused on this booming market, as tech and telecom analyst Andrew Tonner examines in the video below.

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Read/Post Comments (3) | Recommend This Article (1)

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  • Report this Comment On December 14, 2013, at 12:59 PM, foolsmate wrote:

    "This incredible tech stock is growing twice as fast as Google and Facebook, and more than three times as fast as Amazon.com and Apple".

    Huh? Dream on! No it isn't.

    Ebay is absolutely stagnant and once the end of year figures are in it will drop like a stone!

    2013 has seen eBay hike fees to unsustainable levels in order to mask the attrition of sellers that it has forced off its own site. Yes, that's right, this company actually has computerised algorithms in place to rid itself of its own customers!

    It treats its remaining and long-suffering customers with utter contempt. It has become totally complacent because at the moment it has almost an absolute monopoly on online auctions and yet unbelievably Donahoe is desperate to dump these at all costs despite them being its only USP.

    With PayPal acceptance being forced on almost all eBay customers, without eBay it's just dead in the water. Once people really start using BitCoin and other virtual payment systems, PayPal is gone, overnight.

    With the current management this train wreck is going nowhere very fast indeed. Don't believe me? Just read eBay's own 'discussion boards' or try typing 'ebay seller dissatisfaction' into Google.

    Then try 'amazon seller dissatisfaction'.

    You'll soon realise why Amazon stock is at $350+ whilst eBay barely manages to scrape $50.

    When are the markets and commentators going to wake up and see what's really happening at eBay?

  • Report this Comment On December 14, 2013, at 7:01 PM, grahamsway wrote:

    Anybody interested in Ebay should check out footnote 17, I believe, related to Bill Me Later, on the 10-Q.

    Might also want to keep an eye on loan and transaction losses on the CF statement which I don't believe is visible on the Income statement.

  • Report this Comment On December 15, 2013, at 4:24 PM, foolsmate wrote:

    Totally with grahamsway here.

    Pages 39 onwards in the Oct-2013 10-Q should be compulsory reading for every commentator puffing eBay.

    One para that stands out as being particularly apposite for sellers is:

    "The growth of Internet users is slowing in many countries where we have a significant presence. As our growth rates in established markets slow, we will increasingly need to focus on keeping existing Marketplaces users (especially our top buyers and sellers) and PayPal account holders (especially in our merchant services business) active and increasing their activity level on our websites and mobile platforms in order to continue to grow those businesses."

    That'll be why eBay is actively culling its own customers and driving sellers out of business then will it?

    Read the evidence for yourself. This isn't a company with big, confident, forward-looking plans. This is a company that's become absolutely terrified of even its own shadow, and this goes a long way to explaining why making its sellers fearful for their own survival has just become second nature. Rather than fix the problems, just pass them on down the chain.

    Without some very urgent and very serious change at the top this stock is just heading for disaster.

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