Price to Earnings (P/E)
since 2005
Calculation
eBay Inc., P/E, long-term trends, calculation
| P/E | = | Share price1, 2, 3 | ÷ | Earnings per share1 (EPS) | EPS1 | = | Net income (loss)1 (in millions) |
÷ | No. shares of common stock outstanding2 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Jan 30, 2019 | 12.32 | = | 34.08 | ÷ | 2.77 | 2.77 | = | 2,530 | ÷ | 914,880,451 | |
| Feb 5, 2018 | — | = | 42.37 | ÷ | -1.00 | -1.00 | = | -1,016 | ÷ | 1,012,079,673 | |
| Feb 6, 2017 | 4.79 | = | 32.03 | ÷ | 6.68 | 6.68 | = | 7,266 | ÷ | 1,087,042,601 | |
| Feb 1, 2016 | 16.36 | = | 23.94 | ÷ | 1.46 | 1.46 | = | 1,725 | ÷ | 1,178,705,177 | |
| Feb 6, 2015 | 1,433.64 | = | 54.50 | ÷ | 0.04 | 0.04 | = | 46 | ÷ | 1,210,046,829 | |
| Jan 31, 2014 | 24.12 | = | 53.20 | ÷ | 2.21 | 2.21 | = | 2,856 | ÷ | 1,294,654,966 | |
| Feb 1, 2013 | 28.43 | = | 57.21 | ÷ | 2.01 | 2.01 | = | 2,609 | ÷ | 1,296,512,321 | |
| Jan 31, 2012 | 12.59 | = | 31.60 | ÷ | 2.51 | 2.51 | = | 3,229 | ÷ | 1,286,914,976 | |
| Jan 28, 2011 | 21.85 | = | 30.31 | ÷ | 1.39 | 1.39 | = | 1,801 | ÷ | 1,298,369,992 | |
| Feb 17, 2010 | 12.33 | = | 22.68 | ÷ | 1.84 | 1.84 | = | 2,389 | ÷ | 1,299,006,884 | |
| Feb 20, 2009 | 8.78 | = | 12.18 | ÷ | 1.39 | 1.39 | = | 1,779 | ÷ | 1,282,965,764 | |
| Feb 29, 2008 | 100.52 | = | 26.36 | ÷ | 0.26 | 0.26 | = | 348 | ÷ | 1,327,947,115 | |
| Feb 28, 2007 | 38.99 | = | 32.06 | ÷ | 0.82 | 0.82 | = | 1,126 | ÷ | 1,368,973,770 | |
| Feb 24, 2006 | 53.94 | = | 41.49 | ÷ | 0.77 | 0.77 | = | 1,082 | ÷ | 1,406,718,316 |
Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
1 US$
2 Data adjusted for splits and stock dividends.
3 Closing price as at the filing date of eBay Inc. Annual Report.
The Price-to-Earnings (P/E) ratio of eBay Inc. exhibited significant volatility between 2006 and 2019, characterized by extreme fluctuations driven primarily by erratic earnings per share (EPS) performance rather than consistent share price movements.
- Valuation Anomalies and EPS Sensitivity
- Extreme P/E ratios were recorded in 2008 (100.52) and 2015 (1,433.64). These spikes were not the result of rapid share price appreciation, but rather precipitous declines in EPS to 0.26 and 0.04, respectively. These instances indicate periods where the market valuation remained high despite a near-collapse in annual profitability, leading to mathematically inflated ratios.
- Periods of Relative Stability
- A more stabilized valuation trend occurred between 2009 and 2014, with the P/E ratio generally fluctuating between 8.78 and 28.43. During this window, the ratio aligned more closely with fundamental earnings growth, particularly as EPS recovered from the 2008 low and climbed toward a range of 1.39 to 2.51.
- Inverse Relationship Between Earnings and P/E
- A notable inverse correlation is observed in 2017, where EPS reached a peak of 6.68, causing the P/E ratio to drop to its lowest positive value of 4.79. This suggests a period where the company was undervalued relative to its high earnings capacity, or that the market did not anticipate the sustainability of such high earnings.
- Impact of Negative Earnings
- The absence of a P/E ratio in 2018 is attributable to negative earnings per share (-1.00). This represents a fundamental shift in the valuation metric's applicability, as the company transitioned from a profitable state to a loss-making state for that fiscal period, rendering the P/E ratio mathematically undefined.
- Recent Convergence
- By 2019, the P/E ratio returned to a moderate level of 12.32, coinciding with a recovery in EPS to 2.77 and a stabilized share price of 34.08. This suggests a return to a valuation baseline more consistent with the company's historical averages seen in the 2009-2012 period.
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Comparison to Competitors
eBay Inc., P/E, long-term trends, comparison to competitors
| eBay Inc. | Amazon.com Inc. | Home Depot Inc. | Lowe’s Cos. Inc. | TJX Cos. Inc. | |
|---|---|---|---|---|---|
| Jan 30, 2019 | 12.32 | 79.30 | 23.51 | 20.26 | 20.19 |
| Feb 5, 2018 | — | 228.25 | 22.37 | 22.62 | 22.11 |
| Feb 6, 2017 | 4.79 | 166.52 | 23.32 | 26.67 | 22.87 |
| Feb 1, 2016 | 16.36 | 463.73 | 23.15 | 26.24 | 21.62 |
| Feb 6, 2015 | 1,433.64 | — | 20.18 | 21.79 | 20.15 |
| Jan 31, 2014 | 24.12 | 601.07 | 22.86 | 21.13 | 17.99 |
| Feb 1, 2013 | 28.43 | — | 19.49 | 20.46 | 19.73 |
| Jan 31, 2012 | 12.59 | 129.38 | 18.15 | 17.66 | 14.54 |
| Jan 28, 2011 | 21.85 | 67.02 | 20.76 | 19.70 | 14.57 |
| Feb 17, 2010 | 12.33 | 61.80 | 18.59 | 12.26 | 12.02 |
| Feb 20, 2009 | 8.78 | 39.07 | 11.24 | 12.74 | 18.61 |
| Feb 29, 2008 | 100.52 | 65.85 | 12.59 | 15.42 | 16.30 |
| Feb 28, 2007 | 38.99 | 88.17 | 15.57 | 18.31 | 16.91 |
| Feb 24, 2006 | 53.94 | 45.52 | 16.29 | 19.15 | 17.81 |
Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
Comparison to Sector (Consumer Discretionary Distribution & Retail)
eBay Inc., P/E, long-term trends, comparison to sector (consumer discretionary distribution & retail)
| eBay Inc. | Consumer Discretionary Distribution & Retail | |
|---|---|---|
| Jan 30, 2019 | 12.32 | 45.41 |
| Feb 5, 2018 | — | 60.50 |
| Feb 6, 2017 | 4.79 | 47.75 |
| Feb 1, 2016 | 16.36 | 45.72 |
| Feb 6, 2015 | 1,433.64 | 38.28 |
| Jan 31, 2014 | 24.12 | 39.66 |
| Feb 1, 2013 | 28.43 | 37.17 |
| Jan 31, 2012 | 12.59 | 26.94 |
| Jan 28, 2011 | 21.85 | 27.21 |
| Feb 17, 2010 | 12.33 | 21.68 |
| Feb 20, 2009 | 8.78 | 14.47 |
| Feb 29, 2008 | 100.52 | 16.25 |
| Feb 28, 2007 | 38.99 | 17.92 |
| Feb 24, 2006 | 53.94 | 18.45 |
Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
Comparison to Industry (Consumer Discretionary)
eBay Inc., P/E, long-term trends, comparison to industry (consumer discretionary)
| eBay Inc. | Consumer Discretionary | |
|---|---|---|
| Jan 30, 2019 | 12.32 | 33.13 |
| Feb 5, 2018 | — | 47.03 |
| Feb 6, 2017 | 4.79 | 29.19 |
| Feb 1, 2016 | 16.36 | 24.70 |
| Feb 6, 2015 | 1,433.64 | 29.48 |
| Jan 31, 2014 | 24.12 | 26.50 |
| Feb 1, 2013 | 28.43 | 20.90 |
| Jan 31, 2012 | 12.59 | 11.38 |
| Jan 28, 2011 | 21.85 | 17.54 |
| Feb 17, 2010 | 12.33 | 18.66 |
| Feb 20, 2009 | 8.78 | 303.41 |
| Feb 29, 2008 | 100.52 | 24.33 |
| Feb 28, 2007 | 38.99 | 117.34 |
| Feb 24, 2006 | 53.94 | 17.54 |
Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).