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How to Buy eBay Stocks

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Online e-commerce giant eBay (NASDAQ:EBAY) is one of the longest-running Internet success stories. Today, eBay stands as a true household brand name through a range of e-marketplaces that match buyers and sellers for everything under the sun.

The company has been publicly traded since 1998, and 20 years later continues to be a cornerstone growth stock in many investors’ portfolios. eBay has annual revenues of $2.6 billion and counts more than 175 million buyers worldwide through its various platforms.

The eBay app has over 414 million downloads on mobile phones and tablets and generated $12.9 billion in mobile sales volume in the most recent quarter.   Just in the last five years alone, a $10,000 investment would have gained 59.31 percent, bubbling to $15,931.

eBay: A peek into the company

eBay, Inc. was one of the earliest pioneers of the modern, commerce-based Internet, with roots that date back to 1995. Originally built to match buyers and sellers of used goods, the eBay platform grew exponentially to include a broad array of new products, from clothing and electronics to automotive parts and even automobiles themselves.

eBay recently added the StubHub brands for reselling sports and concert tickets, and eBay Classifieds is the largest online local marketplace helping buyers and sellers connect locally in over 1,500 cities around the globe.

A very brief history of eBay stock

eBay debuted on the NASDAQ in the fall of 1998, right at the onset of the first Internet revolution. If you had invested $10,000 in EBAY stock twenty years ago, that investment would now be worth $45,860,000 (as of 9/14/18) – a total return of roughly 4,586 percent. The same investment would have realized a five-year return of 59% and a 10-year return of 273%.

Meanwhile, over the last year, the stock has been down roughly 10%, potentially representing a buying opportunity. Over the last 12 months (ending 9/14/18), EBAY, which has a market capitalization of $34 billion, has traded in a range between $32.85 and $46.99. It’s worth remembering that eBay spun off PayPal (NASDAQ: PYPL) in 2015 into a separate company. Interestingly, Paypal’s stock is up 160% since then while eBay’s stock up only 30%.

eBay's stock price history as of 9/14/2018. Source: Google.com
eBay’s stock price history as of 9/14/2018. Source: Google.com

Should you purchase eBay stock?

The good:

  • eBay pioneered the concept of matching buyers and sellers via an online e-marketplace platform and continues to benefit from its widely-recognized brand, posting gross merchandise value (GMV) of $23.6 billion for the most recent quarter.
  • The company has successfully expanded into B2C sales and is growing a robust third-party marketplace business.
  • eBay is invested heavily in marketplace improvements, such as rolling out three-day guaranteed delivery, designed to make buying and selling on eBay even easier and drive greater sales volume.

The bad:

  • The ongoing battle with Amazon as well as niche players for online marketplace supremacy could make you uneasy if you’re an investor.
  • This summer, eBay stock declined nearly 10% after quarterly results, after concerns the e-marketplace has not kept pace with competitors.

How to purchase EBAY

EBAY is widely traded and listed on the NASDAQ, and its stock is available for purchase through all major brokerage firms that trade in securities. Some basic ideas on how to acquire the stock are as follows:

1. Figure out the size of your investment.

Investing assumes that you expect your capital will increase in value, given enough time, with the full knowledge that it’s possible to lose capital as well. After researching and determining the risks associated with EBAY and weighing your own risk tolerance, decide on an appropriate amount of money to invest in the stock.

2. Find a suitable broker

If you’re unsure of the specific steps to purchase a stock, most brokerages offer phone and local office support and educational videos to demonstrate how to purchase shares.  Don’t have a broker? Check out a few of our favorites from our Best Online Brokerage picks:

Commissions
$0
Account Min
$0
Get started securely through Ally Investment’s website
Commissions
$0
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$0
1 Minute Review

Ally Invest is a comprehensive broker offering easy access to domestic markets. Combining a wide range of charting tools with an easy-to-master platform, Ally is a solid choice for both new and experienced investors. Ally’s mobile app is particularly impressive for investors who already bank with Ally, offering seamless compatibility between accounts. While more experienced investors might be disappointed with Ally’s beginner-oriented educational center, they’re bound to love Ally’s wide range of technical tools and rock-bottom pricing.

Best For
  • Investors who already bank with Ally and want to streamline between accounts
  • Beginners looking for easy-to-follow educational tools
  • Stock investors looking for affordable access to low-priced options and commission-free stock trading
Pros
  • Streamlined interface that’s easy to use and quick to master — even for beginners
  • Wide range of unique tools that makes analyzing securities simple
  • Seamless integration between mobile and desktop offerings, especially for Ally Bank account holders
  • Diversified managed investment portfolios with a low minimum and no advisory fees
  • Impressive ETF screening tools that make it easy to find your next fund
Cons
  • No fee-free mutual funds
  • No access to futures trading
Commissions
$0
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Get started securely through eTrade’s website
Commissions
$0
Account Min
$0
1 Minute Review

E*TRADE is an online discount trading house that offers brokerage and banking services to individuals and businesses. One of the first brokers to embrace online trading, E*TRADE not only survived both the dot-com bubble and Recession — it thrived. You can choose from two different platforms (one basic, one advanced). E*TRADE is a suitable broker for traders of most skill levels, whether you want to buy mutual funds and hold them for decades or dabble in options swing trading. E*TRADE offers a library of research and education materials to help you out.

Best For
  • Active traders
  • Derivatives traders
  • Retirement savers
Pros
  • Sophisticated trading platforms
  • Wide range of tradable assets
  • Exceptional customer service
Cons
  • Limited currency trading
  • Higher margin rates than competitors
  • No paper trading on its standard platform
Commissions
$0 $6.95 for OTC Stocks
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Get started securely through TD Ameritrade’s website
Commissions
$0 $6.95 for OTC Stocks
Account Min
$0
1 Minute Review

This publicly listed discount broker, which is in existence for over four decades, is service-intensive, offering intuitive and powerful investment tools. Especially, with equity investing, a flat fee is charged, with the firm claiming that it charges no trade minimum, no data fees, and no platform fees. Though it is pricier than many other discount brokers, what tilts the scales in its favor is its well-rounded service offerings and the quality and value it offers its clients.

Best For
  • Novice investors
  • Retirement savers
  • Day traders
Pros
  • World-class trading platforms
  • Detailed research reports and Education Center
  • Assets ranging from stocks and ETFs to derivatives like futures and options
Cons
  • Thinkorswim can be overwhelming to inexperienced traders
  • Derivatives trading more costly than some competitors
  • Expensive margin rates

3. Purchase shares of EBAY

Once you’re set up with a broker, follow the instructions to enter a purchase order for the number of shares you wish to purchase based on the total dollars you wish to invest.  

eBay stock’s future outlook

Analysts generally acknowledge that the company is uniquely positioned to square off against Amazon, Etsy, Wayfair, and others. Its reputation for providing a high-quality customer experience is steadily improving and the company is making significant investments to strengthen and improve its e-commerce platforms.

Time will ultimately tell whether eBay lives up to long-term expectations. Overall, EBAY stock appears to be a reasonable value, but buy and trade at your own risk.

Final thoughts

eBay’s remarkable success has led many competitors to try to copy its model. The company dominated the U.S. market but has grown to become a global brand. However, with companies like Alibaba, Amazon, Rakuten and others growing in the marketplace, eBay has seen its once-premier spot in the marketplace begin to melt.

Keep an eye on how the company responds to competition over the coming years and whether that forces innovation or compressed margins.

Want to learn more? Check out Benzinga’s picks for the best retail stocks, the best eBay alternatives and how to trade stocks for free.

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