eBay Inc (NASDAQ:EBAY) is one of the largest online retailers in the world and is seeing positive performance from a turnaround in its core businesses. Both its marketplace and payments segment sales have managed to grow sequentially each of the last eight quarters. Driving long-term growth should be momentum in the payments arena and a recent agreement with Discover. eBay saw Steven Cohen and SAC Capital up their stake over 500% last quarter (check out Steven Cohen’s big bets).
Mobile payments volume continues to grow strongly, with eBay stating that aggregate totals went from $750 million in 2010 to $4 billion in 2011, and are currently expected to jump to $10 billion in 2012. One of eBay’s biggest milestones in the mobile payments sector was its agreement with Discover Networks, which has agreed to accept PayPal Cards on Discover machines, covering more than 7 million retail outlets across the U.S.
eBay is embracing mobile in more ways than one, with an early start that has made it one of the leading players. eBay has been introducing useful mobile apps and has managed to grew mobile revenues from $2 billion in 2010 to $5 billion in 2011. One of the big benefits to eBay’s mobile auctions app is that it has managed to push up auction rates.
From a valuation standpoint, eBay is still better priced than top competitor Amazon; eBay trades well below Amazon at 17x earnings, compared to Amazon’s 3000x P/E. Shares also trade below Liberty Interactive’s 19x P/E, despite the fact that growth prospects are generally more robust.
Amazon.com, Inc. (NASDAQ:AMZN), the e-commerce powerhouse, is expected to see sales up almost 30% in both 2012 and 2013. This comes as the tech company continues to take market share from conventional retailers, but also as it looks for more ways to sell its products, including offering its Kindle tablet at cost in an effort to get the device in as many hands as possible. Amazon also has its Prime offering that further encourages customers to buy more often. From an investing point of view, the big downside to Amazon is its valuation, trading at a trailing P/E in excess of 3000x and nearly 100x forward earnings estimates. Billionaire Ken Fisher – founder of Fisher Asset Management – was the e-commerce company’s top fund owner last quarter (check out Ken Fisher’s newest picks).
What about the rest of eBay’s tech peers?