Jing:
It depends on who you listen to.
Some analysts have said that online auctions will triple between 1998 and 2000. They obviously have their heads in the sand because eBay, which probably holds 90 percent of the online auction, is at about 5 times the level it was this time in 1998. (It has tripled in the past 8 months alone.)
eBay will continue to dominate this market and will grow quickly for the foreseeable future.
The $64,000 question is "How big can it get?".
I don't know about going from 3.8B currently to 128B by 2003. What do those numbers represent? Gross sales via online auctions?
If you buy eBay's comments that their average auction is for about $40, and if you believe that eBay gets about $1.40 from each auction, then when eBay reports revenues later this month of around $30M, that would represent about $900M in gross sales, so stating that online auction grosses are around $3.8B annually, right now, seems like it is in the right ballpark.
Even if the online auction market does grow to $128B by 2003, and even if eBay continues to dominate, that does not means that their stock will go up 33 times during that period. At some point, people will start paying more attention to earnings and growth rates, and we can't expect that eBay will always be awarded a 7500:1 P/E.
There ARE upper limits to these things. I mean, what is the GNP, something like $6 trillion?
--Doug
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