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e-bay shares

Discussion in 'Shares' started by Mrs Bird, 1st Nov, 2005.

  1. Mrs Bird

    Mrs Bird New Member

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    4
    Hi everybody,

    Great forum because now I can ask questions about shares. :)

    I have read in several articals that e-bay is a sleeping giant as 75% of trading is still in America. It is such a potentially, powerful company world wide, therefore wouldnt it be logical to buy shares now in the company before it really takes off?

    I know little about shares and no one in my cicrle of friends, are even aware if this company is even listed...I would assume only on the American stock market?

    Could somebody tell me any info about e-bay shares...it would much appreciated :)

    Kind Regards Mrs Bird
     
  2. Tropo

    Tropo Well-Known Member

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    Location:
    NSW
    " Could somebody tell me any info about e-bay shares..."

    Mrs Bird,
    Just call any stock broker in Australia and ask above question.

    :cool:
     
  3. Jacque

    Jacque Team InvestEd

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    Mrs Bird
    I don't know about the shares but I sure love the site. You should see the great result I got on Sunday selling a cabinet- over the moon on the price :)

    Like the purchase of any shares, due diligence is the key so good luck with your homework!
     
  4. Nigel Ward

    Nigel Ward Team InvestEd

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    how much are you charging for postage on that cabinet? ;)
     
  5. Nigel Ward

    Nigel Ward Team InvestEd

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    Hi Mrs B

    I suppose I should make a serious contribution to this thread.

    I guess the starting point for valuing any company is to look at what its future maintainable earnings are likely to be. You would then be prepared to pay a multiple of that figure.

    What is usually published about companies is their historical Price to Earnings or P/E ratio. This is calculated by dividing the current market price by earnings per share. Sometimes you can find prospective P/E ratios published by various stock analysts about companies. Which are the analyst's best guesstimate about what the EPS will be in future periods.

    I haven't seen any P/E figures for ebay, and no doubt you could google them to find out. Speaking of which, there was something in the papers this week about the PE ratio for google and yahoo. They were in the 60-70s from memory. Typically an Australian company would trade on a PE of 10-20, with the market average being about 14-15 I think. You can find that sort of data on the ASX website or in the financial pages of the newspapers. For example, BHP at 20.70 is on an historical PE of around 13.7...

    So, if ebay is on a PE anything like google or yahoo it is on a traditional view VERY expensive. Bear in mind also that typically US stocks pay much lower dividends on average than Australian stocks.

    So in a nutshell, find out how much it is, look at what their forecasts are, think about whether you agree, decide if the price is fair and then decide whether to buy ebay based on your broader financial objectives.

    If you're a novice share investor then reading Steve's dollar cost trading article and some of the introductory shares books published by the ASX would be a good start and probably a wise "investment".

    Good luck
    N.
     
  6. Tropo

    Tropo Well-Known Member

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    Location:
    NSW
    Mrs Bird.

    To add to Nigel Ward very good advise - I attached below an article (I found somewhere in the cyber space), which might help you in your future investing endeavor.

    Investing in Yourself

    As a novice investor , you may often wonder if it will be worth the time and effort in the end. Honing your investing skills can be frustrating at times. You can reach a plateau where you continue to execute trade after trade without making any headway. Not only may you feel that you are wasting precious time, but you may also feel you're throwing good money out the window.

    Investing isn't a cheap endeavor. Besides the books, courses, and computer equipment, money must be spent on draw downs, commissions, and investing errors. It all seems so difficult at times that you may feel like giving up. But don't despair. No matter how much time and money you spend, you can feel a sense of relief by viewing it as a valuable investment in yourself.

    If you are a novice investor, you tend to spend more money than you make. If you grew up in an atmosphere of limited means, you may find it difficult to justify the amount of money it takes to master the markets and become a seasoned investor.

    You may feel guilty or discouraged when you think about how much money you have been losing. You're not alone. Many seasoned investors have had to break away from traditional ideas about money. Family and friends may view investing in shares as a form of gambling. If you invest impulsively just to get a quick thrill, then it's much like recreational gambling.

    But if you're serious about honing your skills, then you aren't wasting your money. You're learning a skilled profession that can help you earn a high salary, just like an engineer, a lawyer, or a doctor.

    Many professionals had to borrow money to earn a marketable skill. Many law students, for example, owe over $100,000 by the time they are ready to practice law.
    Investing it's just like other professions. But you say, "There's no guarantee that I'll be successful." That's true of other professions as well.
    A professional school education doesn't guarantee a high salary.
    Not all lawyers make over $200,000. Public defenders make about $45,000 a year.
    Viewing money you spend to learn how to invest, is best viewed as a form of tuition.

    Even though you may be losing money, it will definitely pay off in the end. You will learn more about yourself. You will gain experiences that you can carry with you into other areas of your life. You can build self-esteem as an investor and that will help you master other areas of your life.

    Be patient. If you stick with it, you'll eventually reach your financial goals. Either you'll gain mastery in a year or two, or if you wait long enough, you'll be able to capitalize on the "irrational exuberance" of the masses.

    For those investors with superior skills, money flowed from the pockets of the masses into theirs. If you keep practicing, gradually honing your skills over time, you'll be able to capitalize on a major market opportunity when it happens.

    Do not feel disappointed about the money you're spending on learning.
    Don't view it as wasting money, but as a significant investment in yourself and your future. :)
     
  7. Jacque

    Jacque Team InvestEd

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    Hehe :)
    Well it was pick up only and the buyer is arranging her own courier so it's out of my hands. Very happy with the price though.
     
  8. TryHard

    TryHard Well-Known Member

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    Posts:
    863
    eBay

    Hi Mrs Bird

    "I have read in several articals that e-bay is a sleeping giant ... wouldnt it be logical to buy shares now in the company before it really takes off?"

    I guess there are a lot of articles written about eBay, but maybe some from the more cautious perspective like :
    - http://business.timesonline.co.uk/article/0,,9075-1449909,00.html
    - http://moneycentral.msn.com/content/CNBCTV/Articles/Dispatches/P133134.asp
    - http://www.thestreet.com/funds/managerstoolbox/933227.html
    would be worth throwing into the mix ?

    eBay looks pretty volatile ? http://bigcharts.marketwatch.com/qu...bay&sid=0&o_symb=ebay&freq=1&time=8&x=56&y=18
    but I bet the NavTrade system would have had fun with it ! (although I sincerely doubt eBay would meet all the NavTrade criteria to be traded)

    Presumably eBay was a 'sleeping giant' in January 2005, just before its share price halved in the ensuing 5 months ? ;-)

    eBay just bought Skype for $2.6bn and eBay also owns PayPal. Skype is in the increasingly competitive Voice over IP market which Microsoft is now throwing big money at. PayPal has its detractors (http://www.paypalsucks.com/) Both these companies form a reasonable part of eBay's business so it would be worth understanding their likely contribution (or need for funding) ?

    I would think eBay is more like 'bleeding edge' than sleeping giant ... with all the attached excitement and potential huge gains and huge losses. Maybe there are some alternative investment options with a longer trading history, a likely better dividend, and a better overall "Sleep At Night Factor" than a dot com 'juggernaut' like Google or eBay.

    By the way the growth in Google share price is ballistic :) (in 52 weeks : $172.57 to $446.21 - http://bigcharts.marketwatch.com/qu...sp?symb=google&sid=0&o_symb=google&x=22&y=11). But from what I understand, if anyone ran the fundamentals on that stock they wouldn't have bought it ?

    The teeth-grinding this info causes me is the reason why I rely on NavraInvest ;-)

    Good luck ! and Happy New Year
    Carl