It's hard to believe, but eBay's (NASDAQ:EBAY) stock has actually outperformed the S&P 500 Index over the last 3, 5, and 10 year periods. Keep in mind, a lot of this performance was driven by the faster-growing payments segment led by PayPal Holdings. Unfortunately, eBay no longer own this segment since PayPal was spun-off a few years ago.

Over the last few years, it has been a rough road for eBay to find meaningful growth. eBay's gross merchandise volume (GMV) has barely budged -- moving only from $83 billion to $85 billion. This is while major retail competitors like Amazon.com and Wal-Mart Stores continue to invest heavily in their e-commerce operations, and are growing much faster because of it. However, it's difficult to make the case that eBay is overvalued, with the stock trading at less than 16 times expected earnings. The important question is: Can the company grow enough to satisfy shareholders?

We'll explore eBay's growth initiatives and their success to determine whether investors should go with eBay or look for greener pastures.

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Management's strategy to accelerate growth

EBay doesn't appear to be losing ground, as it performs very consistently year to year. But there hasn't been much growth, as you can see in this table:

Metric 2016 2015 2014 2013 2012
Revenue $8,979 $8,592 $8,790 $8,257 $7,371
Operating income $2,325 $2,197 $2,476 $2,454 $2,165

Data source: 10-K SEC filing. Dollar amounts in millions.

Management has been active on a few fronts to get the eBay marketplace growing faster and better positioned competitively for the future of e-commerce. The first step is what management calls "structured data," where eBay is using artificial intelligence to improve search and better organize the one billion listings on eBay's marketplace so as to showcase items as products as opposed to listings. What eBay is really trying to do here is transform its image from an auction site to a mainstream retailer.

So far, it appears structured data is helping eBay attract more customers and deliver a more personalized shopping experience. Last quarter, management reported stronger traffic and better user engagement where structured data has been implemented within the marketplace.

Along with structured data, management has rolled out a new marketing campaign called "Fill Your Cart with Color" using television, digital, and social media channels. Again, the early evidence looks promising. In the second quarter, there was an uptick in purchase consideration from buyers in the fashion category, as well as an increase in traffic from new eBay visitors, which was attributed to the new advertising campaign.

Meanwhile, the growth of Amazon and Wal-Mart suggests that eBay is losing market share in the broader retail landscape. Wal-Mart grew its e-commerce revenue 60% in the second quarter, which follows 69% in the first quarter. Also, Amazon continues to consistently post more than 20% growth in its trailing-12-month net sales quarter after quarter.

The dilemma for eBay

The higher growth of these large competitors relative to eBay highlights another problem eBay faces going forward. As it transforms its image from an auction site to a mainstream retailer in order to find more growth, it is making a beeline straight into the lion's den. This leaves investors with a question that has no easy answer right now:

Are these extra investments in structured data and marketing going to improve growth, or are they simply just necessary expenditures in order to maintain current sales volume in the face of mounting pressure from other retail giants?

Based on the early evidence of higher traffic and engagement from short term initiatives, I wouldn't be surprised to see eBay add a few percentage points to its revenue and earnings growth, but that may not be enough for investors who want to assemble a stock portfolio that can beat the market average return.

Don't buy eBay expecting huge returns

With a forward P/E ratio of about 16 and based on management's guidance for 2017 earnings per share, eBay's stock doesn't look overvalued. On the other hand, analysts only expect the company to post 7.5% annual earnings growth per year over the next five years, which is consistent with eBay's recent single-digit growth trend. Based on those expectations, I wouldn't expect eBay's stock to trade any higher on a P/E basis than it is right now -- since high growth companies typically are the ones that justify high P/E ratios.

Investors who buy the stock today will likely only earn a return over time that approximates eBay's earnings growth, which may not be enough for investors seeking a higher return on their investment. If investors want a stock similar to eBay, but with more growth opportunity, check out Mercadolibre, which grew revenue 23% per year from 2011 through 2016, and still has a big opportunity for more growth.

John Ballard owns shares of PayPal Holdings. The Motley Fool owns shares of and recommends Amazon, eBay, MercadoLibre, and PayPal Holdings. The Motley Fool has a disclosure policy.