Is EBAY a good stock to buy? We came across a bullish thesis on eBay Inc. on ARMR Report Be The Smart Money’s Substack by Bret Rosenthal. In this article, we will summarize the bulls’ thesis on EBAY. eBay Inc.’s share was trading at $110.35 as of June 1st. EBAY’s trailing and forward P/E were 25.48 and 18.25 respectively according to Yahoo Finance.
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eBay Inc. (EBAY) is increasingly being viewed as a high-quality recommerce platform rather than a legacy e-commerce marketplace, with its investment case centered on its dominant position in secondary-market liquidity, strong free cash flow generation, and multiple catalysts for further value creation. The company operates an asset-light marketplace model that facilitates discovery, pricing, and trust for pre-owned and specialized goods without carrying inventory or managing extensive logistics networks.
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Through initiatives such as Authenticity Guarantee and AI-powered Magical Listings, eBay has strengthened user trust while reducing seller friction and improving marketplace efficiency. The business delivered strong first-quarter 2026 results, with revenue increasing 17% year-over-year to $3.1 billion, gross merchandise volume rising 14% to $22.2 billion, focus categories such as collectibles, motors, and fashion growing 24%, and non-GAAP operating margins reaching 29.3%. The company generated $898 million of free cash flow during the quarter and continues to aggressively return capital through dividends and share repurchases, supported by a valuation of roughly 15x forward earnings.
Management’s strategy is focused on expanding high-value enthusiast categories, scaling AI-driven tools, and growing first-party advertising, which generated $581 million in quarterly revenue and is growing faster than underlying marketplace activity. eBay’s competitive advantage stems from its scale, seller reputation ecosystem, cross-category liquidity, and inability of larger rivals to effectively serve fragmented, variable-condition inventory.
The bullish thesis is further supported by a $125 per share unsolicited acquisition proposal from GameStop, representing substantial upside from recent trading levels and creating the potential for a significant rerating or competing bids. Combined with expanding monetization, resilient cash flows, and margin growth opportunities, eBay offers an attractive risk-reward profile with meaningful upside and relatively limited downside.
Previously, we covered a bearish thesis on eBay Inc. (EBAY) by Kostadin Ristovski, ACCA in November 2024, which highlighted stagnant GMV growth, limited growth opportunities, and concerns that the stock was overvalued relative to its long-term prospects. EBAY’s stock price has appreciated by approximately 79.43% since our coverage. Bret Rosenthal shares a contrarian view but emphasizes eBay’s recommerce leadership, AI-driven monetization, advertising growth, and acquisition-driven upside potential.
EBay Inc. is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 61 hedge fund portfolios held EBAY at the end of the first quarter which was 59 in the previous quarter. While we acknowledge the risk and potential of EBAY as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than EBAY and that has 10,000% upside potential, check out our report about this cheapest AI stock.
Disclosure: None.
