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Technology Stocks : eBay - Superb Internet Business Model -- Ignore unavailable to you. Want to Upgrade?

To: Bill Jackson who wrote (7044)	9/26/2002 2:21:27 PM
From: AJ Berger	Read Replies (2) \| Respond to of 7772

Your logic escapes me People list for 10 days, because ebay is like advertising. If you put an ad in the newspaper for 3 days instead of 10 days of course you are going to spend much less in listing fees. Sniping has nothing to do with 3 or 10 day listing fees. Sellers don't accumulate more bids from longer listings, they get more potential bidders to notice their auction, that's no different then my newspaper analogy. You can snip just as effectively at 33.3k as on DSL. all you have to do is load ebay into several windows to bid, instead of just the one, and use a watch with seconds on it. I do it all the time very effectively, and I'm online at 54.4k Sniping is the sellers own fault for not setting a minimum or buy-it-now. Using reserve is just stupid, you leave bidders guessing what the reserve is, and many just end up retracting bids if it's too high. Snipers also lose out on side deals, so I usually low ball an auction 2 days before in hopes a seller will contact me privately. Then I snip if the auction is my only change. Even snipers have to research what the going price is for an item so they can set their maximum bid price. I don't understand why you even brought up the subject. It has nothing to do with ebay the stock or it's earnings. There is a separate thread on SI for ebaY gripes. perhaps you are better off posting there. ----------------- guessing reserves reminds me of asian marketplaces. when you buy in a european or arabic farmers market, you ask the price, you get a number, and you bargin. in asian markets they say "how much you pay?" because they respect people who know prices. so if you smart the buyer gives the sellers Cost number, and seller smiles and says, "how I go to make a living?" and they bargin Up to a price the seller's comfortable. This barter system is retarded for most buyers who don't have a clue how much seller items really cost.

To: Bill Jackson who wrote (7044)	9/29/2002 12:37:14 PM
From: SBerglowe	Read Replies (2) \| Respond to of 7772

EBAY analysis from Yahoo: messages.yahoo.com You couldn't have said it clearer! One minor inconsistency that I see in your analysis is that 45% annual growth rates are over and neither you nor I will ever see those rates in our entire lifetime (assuming you are at least 30 yrs old, LOL) NOW, if we assume that EBAY can bring in a CLEAN $150 million in free cash flows x annum and if it can grow that free cash flow at 20% rate for at least the next 5 years, EBAY fair value now is somewhere around $27(FY03) -> $38 (FY07) and not $57 as priced today... LOL Justifying EBay’s current valuations or giving bogus $70 price targets on the basis of a skewed PEG ratio is plain irresponsible and stupid to say the least (this can be witnessed by the most recent folly pushed by Deutsche Bank Research Department)... What happened to Chine’s Walls? LOL And that is me being too optimistic here!!! If Meg expensed stock options in such a way as to reduce the above mentioned free cash flow by a modest 30% rate (remember, in EBay’s case that figure should have been reduced by at least 95%), the $150 million would be brought down to a more realistic figure of $105 million, and therefore EBay’s fair value (the price target now) would have been somewhere around $20(FY03) -> $30(FY07)... Is Ebay overpriced? LOL EBAY fair value now is somewhere around $27(FY03) -> $38 (FY07) and not $57 as priced today... " and... Even that's grossly unrealistic. It assumes that investors will continue to accept the premise that companies not paying a dividend have ANY value, regardless of growth or earnings. The whole argument of companies not paying dividends seemed to center on the belief that they could "put that money to work" and do far better with it (presumably through increased book value or something) than if they returned it directly to the shareholders. Can you think of an argument that has been proven MORE WRONG??? Dividends will be DEMANDED (certainly within 3 years, probably sooner). At the bottom of this secular bear market, the share price of all companies will be based on: 1) REAL book value 2) Dividend yield (5% being typical) Remember, for virtually every tech company, the REAL value of "intangibles" = $0 and "tangibles" = a few thousand (and that would be hard to get for the servers since there's no demand). In other words, REAL book value (for investor purposes) = cash on hand minus all (on- and off-balance sheet) liabilities/debt/obligations. I don't think eBay will ever be able to pay a dividend of more than a quarter or so and their "real book value" will be negligible (or negative). That pegs their MAXIMUM long-term share price at $5.