eBay Inc (EBAY): Should You Invest in This Company Ahead of Results?

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This traditional retailer is an exception

Brick and mortar retailers have been facing a hard time of late because of stiff competition from e-retailers and a weak economy. However, Costco Wholesale Corporation (NASDAQ:COST) has not succumbed to the wrath of time and generated robust results in the year. Its unique membership model and superb customer service has paid off handsomely. In spite of fee increases, its membership renewal rates touched around 89% in the U.S., implying healthy customer loyalty. Costco has also laid down plans for opening of stores in big markets like China and Brazil. The single best thing about Costco is that it invests reasonable resources in ensuring an educated and happy workforce, which helps it maintain high customer satisfaction.

Organic & inorganic growth

The company has gained growth momentum both organically and inorganically. In order to combat stiff competition from major players, eBay Inc (NASDAQ:EBAY) is expanding internationally by acquiring sites/entities that align with its strategies and also by investing great efforts in boosting the growth of marketplace and PayPal. Recently, it acquired 2dehands.be and 2ememain.be, two biggest online classified sites in Belgium. Though not a massive acquisition, it speaks highly of eBay’s plans on global growth.

Final words

In order to promote marketplace’s growth, the company has zeroed in on innovation and mobile adoption as its core strategies. eBay has been rebuked of not being a highly innovative company, which has pushed it into realizing the importance of innovation. For instance, it recently launched “Cassini,” a new search engine on marketplace that has a good number of features aimed at finding products on the website easily.

The three key terms that are glued to the future of eBay Inc (NASDAQ:EBAY)’s business are Marketplace, PayPal and mobile. The company is well placed now to leverage from the recovering economy and the increasing online presence of customers. Hence, it is a good time to invest in the stock.

The article Should You Invest in This Company Ahead of Results? originally appeared on Fool.com and is written by Mihir Mehta.

Mihir Mehta has no position in any stocks mentioned. The Motley Fool recommends Amazon.com, Costco Wholesale, and eBay. The Motley Fool owns shares of Amazon.com, Costco Wholesale, and eBay. Mihir is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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