Cohen Critiques eBay's Financial Metrics Amid Acquisition Bid
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
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Should l Buy EBAY?
Source: stocktwits
- Declining Buyer Base: Cohen's chart on X reveals that eBay's active buyers have decreased from 165 million in 2020 to 135 million in 2025, an 18% drop, indicating significant challenges in user retention that could hinder future sales growth.
- Sales and Profit Decline: eBay's total gross merchandise volume (GMV) fell from $87.6 billion to $79.6 billion, while operating income dropped from $2.64 billion to $2.28 billion, with operating costs rising from $4.46 billion to $5.65 billion, highlighting a persistent deterioration in profitability despite a shrinking user base.
- Acquisition Plans and Cost Savings: GameStop is pursuing a $56 billion acquisition of eBay, expecting to save $2 billion annually within a year post-deal, aiming to enhance profitability through resource integration, although concerns about debt burden have been raised.
- Market Sentiment Shift: While GameStop's board unanimously supports the acquisition proposal, eBay's directors are still reviewing it, and retail investor sentiment around eBay has shifted from 'extremely bullish' to 'bullish', reflecting a complex market attitude towards the acquisition.
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Analyst Views on EBAY
Wall Street analysts forecast EBAY stock price to fall
8 Analyst Rating
2 Buy
5 Hold
1 Sell
Hold
Current: 106.420
Low
60.00
Averages
95.00
High
112.00
Current: 106.420
Low
60.00
Averages
95.00
High
112.00
About EBAY
eBay Inc. is a global commerce company. The Company's technology empowers buyers and sellers in more than 190 markets globally. Its online marketplace is located at www.ebay.com and its localized counterparts, its off-platform marketplaces and its mobile apps. Its Marketplace platforms enable buyers and sellers to its global scale and continue investments in technology, marketing and customer service. Its eBay Money-Back Guarantee program allows buyers to obtain a refund if an item does not arrive, is damaged or faulty, or differs materially from its description, and applies to most purchases completed through payment methods. It develops intuitive user interfaces; buyer, seller and developer tools; and transaction processing, databases and network applications that enable its users to complete transactions on its Marketplace platforms. Its technology infrastructure simplifies the storage and processing of data, eases the deployment and operation of global products and services.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Cohen Critiques eBay's Financial Metrics Amid Acquisition Bid
- Declining Buyer Base: Cohen's chart on X reveals that eBay's active buyers have decreased from 165 million in 2020 to 135 million in 2025, an 18% drop, indicating significant challenges in user retention that could hinder future sales growth.
- Sales and Profit Decline: eBay's total gross merchandise volume (GMV) fell from $87.6 billion to $79.6 billion, while operating income dropped from $2.64 billion to $2.28 billion, with operating costs rising from $4.46 billion to $5.65 billion, highlighting a persistent deterioration in profitability despite a shrinking user base.
- Acquisition Plans and Cost Savings: GameStop is pursuing a $56 billion acquisition of eBay, expecting to save $2 billion annually within a year post-deal, aiming to enhance profitability through resource integration, although concerns about debt burden have been raised.
- Market Sentiment Shift: While GameStop's board unanimously supports the acquisition proposal, eBay's directors are still reviewing it, and retail investor sentiment around eBay has shifted from 'extremely bullish' to 'bullish', reflecting a complex market attitude towards the acquisition.
See More
U.S. Jobs Report Fuels Stock Market Surge
- Strong Employment Data: The U.S. added 115K nonfarm jobs in April, significantly exceeding the 63K forecast, while the unemployment rate held steady at 4.3%, indicating labor market resilience that could bolster investor confidence and drive stock market gains.
- Semiconductor Sector Performance: AMD reported adjusted earnings of $1.37 per share and revenue of $10.25 billion for Q1, a 38% year-over-year increase, leading to a 26% surge in its stock price, reflecting strong market enthusiasm for its robust performance and solidifying its leadership in the semiconductor industry.
- Disney's Earnings Beat: Disney's quarterly results surpassed expectations, driven by improved streaming profitability and strong guest spending in its resorts and cruise business, resulting in a ~7% stock price increase, marking a significant milestone in its efforts to enhance streaming profitability.
- Amazon Supply Chain Services: Amazon's announcement of its Supply Chain Services, which bundles freight, distribution, and parcel shipping, has put pressure on traditional logistics companies like FedEx and UPS, potentially reshaping the freight delivery landscape.
See More
GameStop's $56B Bid for eBay Sparks Analyst Debate
- Acquisition Proposal Analysis: GameStop's bid to acquire eBay for approximately $56 billion in cash and stock has prompted analysts to suggest that eBay should consider the proposal, provided shareholder interests are clearly defined, although it faces significant equity rollover challenges.
- Financing Challenges: GameStop's $125 per share offer results in a market value of $56 billion, which exceeds its $9.4 billion cash reserves, leading analysts to warn that such a financing structure could result in high leverage and interest rate risks that may jeopardize business stability.
- Leadership Style Impact: Analysts believe that under GameStop CEO Ryan Cohen's leadership, eBay could see a transformation in operational efficiency, but shareholders would require a larger cash component to mitigate the risks associated with such a significant business overhaul.
- Market Reaction: eBay's stock price surged following the acquisition news, indicating investor interest in eBay's future prospects, while also sparking speculation about potential competing bidders for the e-commerce giant.
See More
GameStop's $56 Billion eBay Bid Faces Financing Challenges
- Financing Commitment Condition: GameStop has secured a $20 billion financing commitment from TD Securities, but a key condition is that the combined company must maintain an investment-grade credit rating, which could jeopardize the deal's feasibility.
- Credit Rating Risk: Moody's Ratings indicated that the acquisition would be 'credit negative' for eBay, estimating that the combined company's leverage could approach nine times, significantly exceeding investment-grade thresholds.
- Market Value Comparison: With a market value of approximately $11 billion, GameStop represents only a fraction of the implied value of the transaction, raising questions about its financing capabilities; the CEO mentioned the possibility of issuing additional stock to facilitate the deal.
- Board Review: eBay has confirmed receipt of GameStop's acquisition proposal and stated that its board will review it, with future decisions directly impacting the progress of the transaction.
See More
Ryan Cohen's eBay Account Suspended Amid Drama
- Account Suspension: Ryan Cohen's eBay account was suspended after he flooded social media with images of items for sale and criticized eBay's management, raising questions about his motives and potentially undermining the credibility of his acquisition intentions.
- Analyst Insights: Wedbush Securities analyst Michael Piccolo noted that Cohen's actions appear more as a publicity stunt than a genuine M&A proposal, although the 13D and HSR filings indicate formal hostile intent that eBay's board must review under fiduciary duties.
- Investor Focus: Piccolo suggests that event-driven investors should watch whether this ongoing drama attracts other credible bidders or forces eBay to accelerate capital returns and strategic actions to defend against further activism.
- Market Performance Analysis: While eBay's shares trade near their 52-week high, the forward price-to-earnings ratio remains below 18, and its market cap is under $50 billion, indicating that the brand still holds secondary market advantages over competitors like Amazon and Walmart.
See More
TD Bank's Letter to GameStop States eBay Merger Must Meet Investment Grade Standards - CNBC
- GameStop's Financial Outlook: GameStop's recent letter from TD Bank indicates a combination with eBay is necessary for an investment grade upgrade.
- Investment Grade Implications: The letter suggests that the merger with eBay is crucial for improving GameStop's financial standing and attracting more investors.
See More
Cohen Critiques eBay's Financial Metrics Amid Acquisition Bid
- Declining Buyer Base: Cohen's chart on X reveals that eBay's active buyers have decreased from 165 million in 2020 to 135 million in 2025, an 18% drop, indicating significant challenges in user retention that could hinder future sales growth.
- Sales and Profit Decline: eBay's total gross merchandise volume (GMV) fell from $87.6 billion to $79.6 billion, while operating income dropped from $2.64 billion to $2.28 billion, with operating costs rising from $4.46 billion to $5.65 billion, highlighting a persistent deterioration in profitability despite a shrinking user base.
- Acquisition Plans and Cost Savings: GameStop is pursuing a $56 billion acquisition of eBay, expecting to save $2 billion annually within a year post-deal, aiming to enhance profitability through resource integration, although concerns about debt burden have been raised.
- Market Sentiment Shift: While GameStop's board unanimously supports the acquisition proposal, eBay's directors are still reviewing it, and retail investor sentiment around eBay has shifted from 'extremely bullish' to 'bullish', reflecting a complex market attitude towards the acquisition.
See More
U.S. Jobs Report Fuels Stock Market Surge
- Strong Employment Data: The U.S. added 115K nonfarm jobs in April, significantly exceeding the 63K forecast, while the unemployment rate held steady at 4.3%, indicating labor market resilience that could bolster investor confidence and drive stock market gains.
- Semiconductor Sector Performance: AMD reported adjusted earnings of $1.37 per share and revenue of $10.25 billion for Q1, a 38% year-over-year increase, leading to a 26% surge in its stock price, reflecting strong market enthusiasm for its robust performance and solidifying its leadership in the semiconductor industry.
- Disney's Earnings Beat: Disney's quarterly results surpassed expectations, driven by improved streaming profitability and strong guest spending in its resorts and cruise business, resulting in a ~7% stock price increase, marking a significant milestone in its efforts to enhance streaming profitability.
- Amazon Supply Chain Services: Amazon's announcement of its Supply Chain Services, which bundles freight, distribution, and parcel shipping, has put pressure on traditional logistics companies like FedEx and UPS, potentially reshaping the freight delivery landscape.
See More
GameStop's $56B Bid for eBay Sparks Analyst Debate
- Acquisition Proposal Analysis: GameStop's bid to acquire eBay for approximately $56 billion in cash and stock has prompted analysts to suggest that eBay should consider the proposal, provided shareholder interests are clearly defined, although it faces significant equity rollover challenges.
- Financing Challenges: GameStop's $125 per share offer results in a market value of $56 billion, which exceeds its $9.4 billion cash reserves, leading analysts to warn that such a financing structure could result in high leverage and interest rate risks that may jeopardize business stability.
- Leadership Style Impact: Analysts believe that under GameStop CEO Ryan Cohen's leadership, eBay could see a transformation in operational efficiency, but shareholders would require a larger cash component to mitigate the risks associated with such a significant business overhaul.
- Market Reaction: eBay's stock price surged following the acquisition news, indicating investor interest in eBay's future prospects, while also sparking speculation about potential competing bidders for the e-commerce giant.
See More
GameStop's $56 Billion eBay Bid Faces Financing Challenges
- Financing Commitment Condition: GameStop has secured a $20 billion financing commitment from TD Securities, but a key condition is that the combined company must maintain an investment-grade credit rating, which could jeopardize the deal's feasibility.
- Credit Rating Risk: Moody's Ratings indicated that the acquisition would be 'credit negative' for eBay, estimating that the combined company's leverage could approach nine times, significantly exceeding investment-grade thresholds.
- Market Value Comparison: With a market value of approximately $11 billion, GameStop represents only a fraction of the implied value of the transaction, raising questions about its financing capabilities; the CEO mentioned the possibility of issuing additional stock to facilitate the deal.
- Board Review: eBay has confirmed receipt of GameStop's acquisition proposal and stated that its board will review it, with future decisions directly impacting the progress of the transaction.
See More
Ryan Cohen's eBay Account Suspended Amid Drama
- Account Suspension: Ryan Cohen's eBay account was suspended after he flooded social media with images of items for sale and criticized eBay's management, raising questions about his motives and potentially undermining the credibility of his acquisition intentions.
- Analyst Insights: Wedbush Securities analyst Michael Piccolo noted that Cohen's actions appear more as a publicity stunt than a genuine M&A proposal, although the 13D and HSR filings indicate formal hostile intent that eBay's board must review under fiduciary duties.
- Investor Focus: Piccolo suggests that event-driven investors should watch whether this ongoing drama attracts other credible bidders or forces eBay to accelerate capital returns and strategic actions to defend against further activism.
- Market Performance Analysis: While eBay's shares trade near their 52-week high, the forward price-to-earnings ratio remains below 18, and its market cap is under $50 billion, indicating that the brand still holds secondary market advantages over competitors like Amazon and Walmart.
See More
TD Bank's Letter to GameStop States eBay Merger Must Meet Investment Grade Standards - CNBC
- GameStop's Financial Outlook: GameStop's recent letter from TD Bank indicates a combination with eBay is necessary for an investment grade upgrade.
- Investment Grade Implications: The letter suggests that the merger with eBay is crucial for improving GameStop's financial standing and attracting more investors.
See More
