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.
An analysis of the financial performance between 2006 and 2019 reveals a significant transition in valuation multiples and operational efficiency.
- Price to Operating Profit (P/OP) Volatility
- The P/OP ratio exhibited extreme variance during the initial phase of the observed period. A peak ratio of 57.09 was recorded in February 2008, which coincided with a sharp decline in operating profit per share to 0.46. Conversely, the ratio reached its lowest point of 7.53 in February 2009, reflecting a period where the share price declined more steeply than the corresponding operating profit.
- Operating Profit per Share Trends
- Operating profit per share demonstrated a general long-term upward trajectory, increasing from 1.02 in 2006 to 2.43 by 2019. Despite intermittent declines—most notably in 2008 and 2016—the overall trend indicates a strengthening of operational profitability over the fourteen-year span.
- Share Price and Valuation Normalization
- Share price movements were characterized by significant instability, reaching a peak of 57.21 in 2013 before retreating to 34.08 by 2019. While the share price experienced substantial fluctuations, the valuation multiple (P/OP) became notably more compressed and stable from 2010 onwards, generally oscillating within a range of 12 to 26. This suggests a shift toward a more mature valuation based on consistent operating performance.
The overall trend indicates a movement away from the highly volatile valuation environment seen between 2006 and 2009 toward a period of relative stability in the price-to-operating-profit relationship, supported by a steady increase in per-share operating earnings.
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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).