Intrinsic value of eBay - EBAY

Previous Close

$37.29

  Intrinsic Value

$39.07

stock screener

  Rating & Target

hold

+5%

  Value-price divergence*

-27%

Previous close

$37.29

 
Intrinsic value

$39.07

 
Up/down potential

+5%

 
Rating

hold

 
Value-price divergence*

-27%

*Intrinsic value change (in %) minus stock price change (in %) in the past 12 months.

We calculate the intrinsic value of EBAY stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 2016), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 39.7

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  4.50
  4.40
  4.46
  4.51
  4.56
  4.61
  4.65
  4.68
  4.71
  4.74
  4.77
  4.79
  4.81
  4.83
  4.85
  4.86
  4.88
  4.89
  4.90
  4.91
  4.92
  4.93
  4.93
  4.94
  4.95
  4.95
  4.96
  4.96
  4.97
  4.97
  4.97
Revenue, $m
  8,979
  9,374
  9,792
  10,234
  10,701
  11,194
  11,714
  12,262
  12,840
  13,449
  14,090
  14,765
  15,476
  16,224
  17,010
  17,837
  18,707
  19,621
  20,583
  21,594
  22,656
  23,772
  24,945
  26,177
  27,472
  28,833
  30,262
  31,763
  33,341
  34,997
  36,737
Variable operating expenses, $m
 
  6,251
  6,510
  6,784
  7,073
  7,378
  7,700
  8,039
  8,397
  8,773
  9,170
  9,138
  9,578
  10,040
  10,527
  11,039
  11,577
  12,143
  12,738
  13,364
  14,021
  14,712
  15,438
  16,200
  17,002
  17,844
  18,728
  19,658
  20,634
  21,659
  22,736
Fixed operating expenses, $m
 
  678
  694
  712
  730
  748
  767
  786
  805
  825
  846
  867
  889
  911
  934
  957
  981
  1,006
  1,031
  1,057
  1,083
  1,110
  1,138
  1,166
  1,196
  1,225
  1,256
  1,287
  1,320
  1,353
  1,386
Total operating expenses, $m
  6,654
  6,929
  7,204
  7,496
  7,803
  8,126
  8,467
  8,825
  9,202
  9,598
  10,016
  10,005
  10,467
  10,951
  11,461
  11,996
  12,558
  13,149
  13,769
  14,421
  15,104
  15,822
  16,576
  17,366
  18,198
  19,069
  19,984
  20,945
  21,954
  23,012
  24,122
Operating income, $m
  2,325
  2,445
  2,588
  2,739
  2,899
  3,068
  3,248
  3,438
  3,638
  3,850
  4,074
  4,760
  5,009
  5,272
  5,549
  5,841
  6,148
  6,473
  6,814
  7,173
  7,552
  7,950
  8,369
  8,811
  9,275
  9,764
  10,278
  10,818
  11,387
  11,986
  12,615
EBITDA, $m
  3,007
  3,085
  3,236
  3,396
  3,565
  3,745
  3,935
  4,136
  4,348
  4,572
  4,809
  5,059
  5,322
  5,600
  5,893
  6,202
  6,527
  6,869
  7,230
  7,610
  8,010
  8,431
  8,874
  9,340
  9,830
  10,347
  10,890
  11,461
  12,062
  12,693
  13,358
Interest expense (income), $m
  220
  263
  281
  300
  321
  342
  365
  389
  414
  441
  469
  499
  530
  563
  598
  634
  672
  712
  755
  799
  846
  895
  946
  1,001
  1,057
  1,117
  1,180
  1,246
  1,316
  1,389
  1,465
Earnings before tax, $m
  3,651
  2,182
  2,307
  2,438
  2,578
  2,726
  2,883
  3,049
  3,224
  3,409
  3,605
  4,261
  4,479
  4,709
  4,951
  5,207
  5,476
  5,760
  6,059
  6,374
  6,706
  7,055
  7,423
  7,810
  8,217
  8,646
  9,097
  9,572
  10,072
  10,597
  11,150
Tax expense, $m
  -3,634
  589
  623
  658
  696
  736
  778
  823
  870
  920
  973
  1,151
  1,209
  1,271
  1,337
  1,406
  1,479
  1,555
  1,636
  1,721
  1,811
  1,905
  2,004
  2,109
  2,219
  2,334
  2,456
  2,584
  2,719
  2,861
  3,010
Net income, $m
  7,266
  1,593
  1,684
  1,780
  1,882
  1,990
  2,104
  2,225
  2,353
  2,489
  2,631
  3,111
  3,270
  3,438
  3,615
  3,801
  3,998
  4,205
  4,423
  4,653
  4,895
  5,150
  5,419
  5,701
  5,999
  6,312
  6,641
  6,988
  7,352
  7,736
  8,139

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  7,130
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  23,847
  17,456
  18,235
  19,058
  19,928
  20,846
  21,814
  22,835
  23,911
  25,045
  26,239
  27,496
  28,819
  30,211
  31,676
  33,216
  34,836
  36,539
  38,329
  40,211
  42,189
  44,268
  46,452
  48,748
  51,159
  53,693
  56,354
  59,150
  62,087
  65,172
  68,412
Adjusted assets (=assets-cash), $m
  16,717
  17,456
  18,235
  19,058
  19,928
  20,846
  21,814
  22,835
  23,911
  25,045
  26,239
  27,496
  28,819
  30,211
  31,676
  33,216
  34,836
  36,539
  38,329
  40,211
  42,189
  44,268
  46,452
  48,748
  51,159
  53,693
  56,354
  59,150
  62,087
  65,172
  68,412
Revenue / Adjusted assets
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
  0.537
Average production assets, $m
  1,631
  1,706
  1,782
  1,863
  1,948
  2,037
  2,132
  2,232
  2,337
  2,448
  2,564
  2,687
  2,817
  2,953
  3,096
  3,246
  3,405
  3,571
  3,746
  3,930
  4,123
  4,326
  4,540
  4,764
  5,000
  5,248
  5,508
  5,781
  6,068
  6,369
  6,686
Working capital, $m
  5,028
  -684
  -715
  -747
  -781
  -817
  -855
  -895
  -937
  -982
  -1,029
  -1,078
  -1,130
  -1,184
  -1,242
  -1,302
  -1,366
  -1,432
  -1,503
  -1,576
  -1,654
  -1,735
  -1,821
  -1,911
  -2,005
  -2,105
  -2,209
  -2,319
  -2,434
  -2,555
  -2,682
Total debt, $m
  8,960
  8,029
  8,581
  9,164
  9,781
  10,431
  11,118
  11,842
  12,605
  13,409
  14,256
  15,147
  16,085
  17,072
  18,110
  19,202
  20,351
  21,558
  22,828
  24,162
  25,564
  27,038
  28,587
  30,214
  31,924
  33,720
  35,607
  37,589
  39,671
  41,859
  44,156
Total liabilities, $m
  13,308
  12,377
  12,929
  13,512
  14,129
  14,779
  15,466
  16,190
  16,953
  17,757
  18,604
  19,495
  20,433
  21,420
  22,458
  23,550
  24,699
  25,906
  27,176
  28,510
  29,912
  31,386
  32,935
  34,562
  36,272
  38,068
  39,955
  41,937
  44,019
  46,207
  48,504
Total equity, $m
  10,539
  5,080
  5,306
  5,546
  5,799
  6,066
  6,348
  6,645
  6,958
  7,288
  7,636
  8,001
  8,386
  8,792
  9,218
  9,666
  10,137
  10,633
  11,154
  11,702
  12,277
  12,882
  13,518
  14,186
  14,887
  15,625
  16,399
  17,213
  18,067
  18,965
  19,908
Total liabilities and equity, $m
  23,847
  17,457
  18,235
  19,058
  19,928
  20,845
  21,814
  22,835
  23,911
  25,045
  26,240
  27,496
  28,819
  30,212
  31,676
  33,216
  34,836
  36,539
  38,330
  40,212
  42,189
  44,268
  46,453
  48,748
  51,159
  53,693
  56,354
  59,150
  62,086
  65,172
  68,412
Debt-to-equity ratio
  0.850
  1.580
  1.620
  1.650
  1.690
  1.720
  1.750
  1.780
  1.810
  1.840
  1.870
  1.890
  1.920
  1.940
  1.960
  1.990
  2.010
  2.030
  2.050
  2.060
  2.080
  2.100
  2.110
  2.130
  2.140
  2.160
  2.170
  2.180
  2.200
  2.210
  2.220
Adjusted equity ratio
  0.204
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291
  0.291

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  7,266
  1,593
  1,684
  1,780
  1,882
  1,990
  2,104
  2,225
  2,353
  2,489
  2,631
  3,111
  3,270
  3,438
  3,615
  3,801
  3,998
  4,205
  4,423
  4,653
  4,895
  5,150
  5,419
  5,701
  5,999
  6,312
  6,641
  6,988
  7,352
  7,736
  8,139
Depreciation, amort., depletion, $m
  682
  640
  648
  657
  667
  676
  687
  698
  710
  722
  735
  299
  313
  328
  344
  361
  378
  397
  416
  437
  458
  481
  504
  529
  556
  583
  612
  642
  674
  708
  743
Funds from operations, $m
  2,846
  2,233
  2,332
  2,437
  2,548
  2,667
  2,791
  2,924
  3,063
  3,211
  3,366
  3,409
  3,583
  3,766
  3,959
  4,162
  4,376
  4,602
  4,839
  5,090
  5,353
  5,631
  5,923
  6,231
  6,554
  6,895
  7,253
  7,630
  8,027
  8,444
  8,882
Change in working capital, $m
  20
  -29
  -31
  -32
  -34
  -36
  -38
  -40
  -42
  -44
  -47
  -49
  -52
  -55
  -57
  -60
  -63
  -67
  -70
  -74
  -78
  -81
  -86
  -90
  -95
  -99
  -104
  -110
  -115
  -121
  -127
Cash from operations, $m
  2,826
  2,262
  2,362
  2,469
  2,583
  2,702
  2,829
  2,964
  3,105
  3,255
  3,413
  3,459
  3,635
  3,820
  4,016
  4,222
  4,440
  4,669
  4,910
  5,164
  5,431
  5,713
  6,009
  6,321
  6,649
  6,994
  7,357
  7,740
  8,142
  8,565
  9,009
Maintenance CAPEX, $m
  0
  -181
  -190
  -198
  -207
  -216
  -226
  -237
  -248
  -260
  -272
  -285
  -299
  -313
  -328
  -344
  -361
  -378
  -397
  -416
  -437
  -458
  -481
  -504
  -529
  -556
  -583
  -612
  -642
  -674
  -708
New CAPEX, $m
  -626
  -75
  -76
  -80
  -85
  -90
  -95
  -100
  -105
  -111
  -117
  -123
  -129
  -136
  -143
  -151
  -158
  -166
  -175
  -184
  -193
  -203
  -213
  -224
  -236
  -248
  -260
  -273
  -287
  -301
  -317
Cash from investing activities, $m
  -2,008
  -256
  -266
  -278
  -292
  -306
  -321
  -337
  -353
  -371
  -389
  -408
  -428
  -449
  -471
  -495
  -519
  -544
  -572
  -600
  -630
  -661
  -694
  -728
  -765
  -804
  -843
  -885
  -929
  -975
  -1,025
Free cash flow, $m
  818
  2,005
  2,097
  2,191
  2,291
  2,396
  2,508
  2,627
  2,752
  2,885
  3,025
  3,051
  3,207
  3,371
  3,545
  3,728
  3,921
  4,124
  4,338
  4,563
  4,801
  5,051
  5,315
  5,592
  5,884
  6,191
  6,514
  6,854
  7,212
  7,589
  7,985
Issuance/(repayment) of debt, $m
  2,196
  520
  552
  584
  617
  651
  687
  724
  763
  804
  847
  891
  938
  987
  1,038
  1,092
  1,148
  1,207
  1,269
  1,334
  1,402
  1,474
  1,549
  1,627
  1,710
  1,796
  1,887
  1,982
  2,082
  2,187
  2,297
Issuance/(repurchase) of shares, $m
  -2,841
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  -744
  520
  552
  584
  617
  651
  687
  724
  763
  804
  847
  891
  938
  987
  1,038
  1,092
  1,148
  1,207
  1,269
  1,334
  1,402
  1,474
  1,549
  1,627
  1,710
  1,796
  1,887
  1,982
  2,082
  2,187
  2,297
Total cash flow (excl. dividends), $m
  -16
  2,525
  2,649
  2,774
  2,907
  3,047
  3,195
  3,351
  3,515
  3,689
  3,871
  3,942
  4,145
  4,358
  4,583
  4,820
  5,069
  5,331
  5,607
  5,898
  6,203
  6,525
  6,863
  7,219
  7,593
  7,987
  8,401
  8,837
  9,295
  9,776
  10,282
Retained Cash Flow (-), $m
  -3,963
  -220
  -227
  -240
  -253
  -267
  -282
  -297
  -313
  -330
  -347
  -366
  -385
  -405
  -426
  -448
  -471
  -496
  -521
  -548
  -576
  -605
  -636
  -668
  -702
  -737
  -774
  -814
  -855
  -898
  -943
Prev. year cash balance distribution, $m
 
  5,679
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
 
  7,984
  2,422
  2,535
  2,654
  2,780
  2,913
  3,054
  3,202
  3,359
  3,524
  3,576
  3,760
  3,953
  4,157
  4,372
  4,598
  4,836
  5,086
  5,350
  5,628
  5,920
  6,228
  6,551
  6,892
  7,250
  7,627
  8,023
  8,440
  8,878
  9,339
Discount rate, %
 
  4.30
  4.52
  4.74
  4.98
  5.23
  5.49
  5.76
  6.05
  6.35
  6.67
  7.00
  7.35
  7.72
  8.11
  8.51
  8.94
  9.39
  9.86
  10.35
  10.87
  11.41
  11.98
  12.58
  13.21
  13.87
  14.56
  15.29
  16.05
  16.86
  17.70
PV of cash for distribution, $m
 
  7,655
  2,217
  2,206
  2,185
  2,155
  2,114
  2,063
  2,001
  1,929
  1,847
  1,698
  1,604
  1,503
  1,396
  1,283
  1,168
  1,052
  937
  824
  715
  612
  517
  429
  351
  282
  223
  172
  131
  97
  70
Current shareholders' claim on cash, %
  100
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0

eBay Inc. (eBay) is a commerce company, which operates through its Marketplace, StubHub and Classifieds platforms. The Company connects buyers and sellers around the world. Its platforms enable sellers around the world to organize and offer their inventory for sale, and buyers to find and purchase it. Its platforms are accessible through an online experience (desktop and laptop computers), from mobile devices (smartphones and tablets) and by application programming interface (API) (platform access for third-party software developers). The Company's Marketplace platforms include its online marketplace located at www.ebay.com, localized counterparts and the eBay mobile applications. The Company's StubHub platforms include its online ticket platform located at www.stubhub.com, the StubHub mobile applications and Ticketbis. The Company's Classifieds platforms include a collection of brands, such as Mobile.de, Kijiji, Gumtree, Marktplaats, eBay Kleinanzeigen and others.

FINANCIAL RATIOS  of  eBay (EBAY)

Valuation Ratios
P/E Ratio 5.6
Price to Sales 4.5
Price to Book 3.8
Price to Tangible Book
Price to Cash Flow 14.3
Price to Free Cash Flow 18.4
Growth Rates
Sales Growth Rate 4.5%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -6.3%
Cap. Spend. - 3 Yr. Gr. Rate -1.6%
Financial Strength
Quick Ratio 5
Current Ratio 0.1
LT Debt to Equity 71.2%
Total Debt to Equity 85%
Interest Coverage 18
Management Effectiveness
Return On Assets 37%
Ret/ On Assets - 3 Yr. Avg. 14.3%
Return On Total Capital 44.3%
Ret/ On T. Cap. - 3 Yr. Avg. 17.6%
Return On Equity 84.9%
Return On Equity - 3 Yr. Avg. 32.7%
Asset Turnover 0.4
Profitability Ratios
Gross Margin 77.6%
Gross Margin - 3 Yr. Avg. 79.4%
EBITDA Margin 50.7%
EBITDA Margin - 3 Yr. Avg. 42.1%
Operating Margin 25.9%
Oper. Margin - 3 Yr. Avg. 26.5%
Pre-Tax Margin 40.7%
Pre-Tax Margin - 3 Yr. Avg. 32.4%
Net Profit Margin 80.9%
Net Profit Margin - 3 Yr. Avg. 33.8%
Effective Tax Rate -99.5%
Eff/ Tax Rate - 3 Yr. Avg. 18%
Payout Ratio 0%

EBAY stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the EBAY stock intrinsic value calculation we used $8979 million for the last fiscal year's total revenue generated by eBay. The default revenue input number comes from 2016 income statement of eBay. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our EBAY stock valuation model: a) initial revenue growth rate of 4.4% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 4.3%, whose default value for EBAY is calculated based on our internal credit rating of eBay, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of eBay.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of EBAY stock the variable cost ratio is equal to 66.9%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $661 million in the base year in the intrinsic value calculation for EBAY stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 3.5% for eBay.

Corporate tax rate of 27% is the nominal tax rate for eBay. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the EBAY stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for EBAY are equal to 18.2%.

Life of production assets of 9 years is the average useful life of capital assets used in eBay operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for EBAY is equal to -7.3%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $10539 million for eBay - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 1064.3 million for eBay is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of eBay at the current share price and the inputted number of shares is $39.7 billion.

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COMPANY NEWS

▶ Company News For Oct 20, 2017   [Oct-20-17 10:28AM  Zacks]
▶ Stocks Veer Lower; Verizon Surges, Apple Dives On Watch Glitch   [09:39AM  Investor's Business Daily]
▶ [$$] EBay Shares Fall on Lowered Profit Outlook   [05:17PM  The Wall Street Journal]
▶ EBay Meets Earnings Views, But Shares Tumble On Weak Outlook   [05:15PM  Investor's Business Daily]
▶ EBay meets 3Q profit forecasts   [04:29PM  Associated Press]
▶ eBay Sinks 5%: Guidance DisappointsAgain   [04:21PM  Barrons.com]
▶ 5 of the Craziest Items You Can Buy Off eBay   [10:52AM  TheStreet.com]
▶ [$$] EBay Earnings: What to Watch   [05:30AM  The Wall Street Journal]
▶ EBay Making a Bid for a Solid Q3   [10:53AM  Barrons.com]
▶ David Rolfe Comments on PayPal Holdings   [05:45PM  GuruFocus.com]
▶ EBay Scores Price-Target Hike As Optimism Grows On Earnings   [04:52PM  Investor's Business Daily]
▶ eBay Earnings Preview: What to Watch   [Oct-15-17 09:05PM  Motley Fool]
▶ [$$] Morgan Stanley Sees Payoffs From PayPal   [Oct-14-17 12:36AM  Barrons.com]
▶ Amazons International Losses: What Could They Be in 3Q17?   [Oct-13-17 03:06PM  Market Realist]
▶ [$$] Week in Review, October 14   [01:30PM  Financial Times]
▶ [$$] Why PayPal Is Stronger Than EBay   [Oct-12-17 02:47PM  Barrons.com]
▶ Stock-picking in this market is like good fishing   [Oct-11-17 06:59PM  CNBC Videos]
▶ PayPal Climbs On Upgrade, 'Never Going To Look Cheap Again'   [05:10PM  Investor's Business Daily]
▶ Why the PayPal Party Could Keep Rocking   [02:53PM  Barrons.com]
▶ This Just In: PayPal Stock Upgraded   [01:55PM  Motley Fool]
▶ The Five Hottest Holiday Toys, According to Ebay   [Oct-09-17 11:21AM  Fortune]
Financial statements of EBAY
Valuation of Stocks

The paper VALUATION OF STOCKS: The Quest for Intrinsic Value provides a detailed description of our valuation model and discloses the calculation algorithm.

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