Price to Operating Profit (P/OP)
since 2005
Calculation
eBay Inc., P/OP, long-term trends, calculation
| P/OP | = | Share price1, 2, 3 | ÷ | Operating profit per share1 | Operating profit per share1 | = | Income from operations1 (in millions) |
÷ | No. shares of common stock outstanding2 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Jan 30, 2019 | 14.03 | = | 34.08 | ÷ | 2.43 | 2.43 | = | 2,222 | ÷ | 914,880,451 | |
| Feb 5, 2018 | 18.93 | = | 42.37 | ÷ | 2.24 | 2.24 | = | 2,265 | ÷ | 1,012,079,673 | |
| Feb 6, 2017 | 14.98 | = | 32.03 | ÷ | 2.14 | 2.14 | = | 2,325 | ÷ | 1,087,042,601 | |
| Feb 1, 2016 | 12.84 | = | 23.94 | ÷ | 1.86 | 1.86 | = | 2,197 | ÷ | 1,178,705,177 | |
| Feb 6, 2015 | 18.77 | = | 54.50 | ÷ | 2.90 | 2.90 | = | 3,514 | ÷ | 1,210,046,829 | |
| Jan 31, 2014 | 20.43 | = | 53.20 | ÷ | 2.60 | 2.60 | = | 3,371 | ÷ | 1,294,654,966 | |
| Feb 1, 2013 | 25.68 | = | 57.21 | ÷ | 2.23 | 2.23 | = | 2,888 | ÷ | 1,296,512,321 | |
| Jan 31, 2012 | 17.13 | = | 31.60 | ÷ | 1.84 | 1.84 | = | 2,373 | ÷ | 1,286,914,976 | |
| Jan 28, 2011 | 19.16 | = | 30.31 | ÷ | 1.58 | 1.58 | = | 2,054 | ÷ | 1,298,369,992 | |
| Feb 17, 2010 | 20.22 | = | 22.68 | ÷ | 1.12 | 1.12 | = | 1,457 | ÷ | 1,299,006,884 | |
| Feb 20, 2009 | 7.53 | = | 12.18 | ÷ | 1.62 | 1.62 | = | 2,076 | ÷ | 1,282,965,764 | |
| Feb 29, 2008 | 57.09 | = | 26.36 | ÷ | 0.46 | 0.46 | = | 613 | ÷ | 1,327,947,115 | |
| Feb 28, 2007 | 30.84 | = | 32.06 | ÷ | 1.04 | 1.04 | = | 1,423 | ÷ | 1,368,973,770 | |
| Feb 24, 2006 | 40.48 | = | 41.49 | ÷ | 1.02 | 1.02 | = | 1,442 | ÷ | 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.
- Share Price Trend
- The share price exhibited considerable volatility over the analyzed period. Starting at $41.49 in early 2006, it decreased steadily to a low of $12.18 by early 2009. Following this trough, the price experienced a strong recovery, peaking at $57.21 in early 2013. After this peak, the share price ranged between approximately $23.94 and $54.50, showing fluctuations but no clear directional trend. Notably, the price dipped to $23.94 in early 2016 before rising again to $42.37 by early 2018, then slightly declining to $34.08 by early 2019.
- Operating Profit per Share Dynamics
- Operating profit per share displayed an overall increasing trend with some fluctuations. Beginning at $1.02 in early 2006, the figure decreased to $0.46 by early 2008 but then recovered sharply, reaching $1.62 in early 2009. From that point onward, operating profit per share generally rose, achieving a peak of $2.90 in early 2015. After a decline in 2016 to $1.86, it steadily increased again, reaching $2.43 by early 2019. This pattern suggests improving operational efficiency and profitability over the long term despite intermittent setbacks.
- Price to Operating Profit Ratio (P/OP)
- The P/OP ratio demonstrated significant fluctuations during the period. Beginning at a relatively high level of 40.48 in early 2006, the ratio declined sharply to 7.53 by early 2009, coinciding with the low share price and recovery in operating profit per share. Following 2009, the ratio rose again, peaking at 25.68 in early 2013, reflecting elevated market valuations relative to operating profits. Subsequently, the ratio trended downward with some variability, moving toward more moderate levels around 14.03 by early 2019. This indicates changing market sentiment and valuation perspectives in relation to operating profit performance.
- Summary of Financial Performance and Market Valuation Relationships
- The data show a period of financial stress culminating in early 2009, with depressed share prices and temporarily reduced operating profits. Subsequently, operational performance improved consistently, as indicated by rising operating profit per share. The share price and market valuation ratios reflected these operational changes but with noticeable volatility, suggesting external market factors and investor sentiment also influenced pricing. The decoupling and recoupling of share price with operating profitability at various intervals imply periods where the market either undervalued or overvalued the company's earnings generation capacity. Overall, the financial performance strengthened over the analyzed years, while the market valuation exhibited cyclical tendencies.
Comparison to Competitors
eBay Inc., P/OP, long-term trends, comparison to competitors
| eBay Inc. | Amazon.com Inc. | Home Depot Inc. | Lowe’s Cos. Inc. | |
|---|---|---|---|---|
| Jan 30, 2019 | 14.03 | 64.31 | 13.82 | 10.61 |
| Feb 5, 2018 | 18.93 | 168.60 | 13.26 | 11.97 |
| Feb 6, 2017 | 14.98 | 94.32 | 13.88 | 13.66 |
| Feb 1, 2016 | 12.84 | 123.77 | 14.03 | 14.77 |
| Feb 6, 2015 | 18.77 | 925.12 | 11.86 | — |
| Jan 31, 2014 | 20.43 | 221.06 | 13.35 | — |
| Feb 1, 2013 | 25.68 | 183.43 | 11.36 | — |
| Jan 31, 2012 | 17.13 | 94.71 | 10.38 | — |
| Jan 28, 2011 | 19.16 | 54.92 | 11.50 | — |
| Feb 17, 2010 | 20.22 | 49.38 | 9.64 | — |
| Feb 20, 2009 | 7.53 | 29.93 | 6.82 | — |
| Feb 29, 2008 | 57.09 | 47.85 | 7.50 | — |
| Feb 28, 2007 | 30.84 | 43.07 | 9.71 | — |
| Feb 24, 2006 | 40.48 | 37.83 | 10.28 | — |
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).