DCF Studio

    EBAY · NMS · Consumer Cyclical

    eBay Inc.

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 70.02

    Market price

    USD 120.93

    Implied upside

    -42.1%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    Current EV/EBITDA of 21.4x sits outside a defensible 3-20x band, so the exit multiple is capped at 20.0x. A multiple that far out usually means EBITDA is the wrong denominator for this business.

    Value Per Share

    Perpetuity growth
    USD 70.02-42.1%
    Exit multiple
    USD 118.37-2.1%
    Market price
    USD 120.93

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn1bn3bnFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 12.6bnUSD 13.6bnUSD 14.4bnUSD 15.3bnUSD 16.1bnUSD 16.9bnUSD 17.7bnUSD 18.3bnUSD 18.9bnUSD 19.3bn+4.8%
    EBITUSD 2.7bnUSD 2.9bnUSD 3.1bnUSD 3.3bnUSD 3.5bnUSD 3.7bnUSD 3.8bnUSD 3.9bnUSD 4.1bnUSD 4.2bn+4.8%
    NOPATUSD 2.4bnUSD 2.5bnUSD 2.7bnUSD 2.9bnUSD 3.0bnUSD 3.2bnUSD 3.3bnUSD 3.4bnUSD 3.5bnUSD 3.6bn+4.8%
    Add depreciation & amortisationUSD 484.2mUSD 519.0mUSD 553.2mUSD 586.5mUSD 618.3mUSD 648.3mUSD 675.8mUSD 700.7mUSD 722.3mUSD 740.3m+4.8%
    Less capital expenditureUSD -577.9mUSD -654.4mUSD -734.8mUSD -818.6mUSD -904.7mUSD -992.2mUSD -1.1bnUSD -1.2bnUSD -1.3bnUSD -1.3bn+9.7%
    Capex, % of revenue4.6%4.8%5.1%5.3%5.6%5.9%6.1%6.4%6.6%6.9%-
    Less increase in working capitalUSD -69.7mUSD -41.0mUSD -40.3mUSD -39.2mUSD -37.5mUSD -35.2mUSD -32.5mUSD -29.2mUSD -25.5mUSD -21.3m-12.4%
    Free cashflow to firmUSD 2.2bnUSD 2.4bnUSD 2.5bnUSD 2.6bnUSD 2.7bnUSD 2.8bnUSD 2.9bnUSD 2.9bnUSD 3.0bnUSD 3.0bn+3.5%
    Discount factor0.95670.87560.80130.73340.67120.61430.56220.51450.47090.4310-
    Present valueUSD 2.1bnUSD 2.1bnUSD 2.0bnUSD 1.9bnUSD 1.8bnUSD 1.7bnUSD 1.6bnUSD 1.5bnUSD 1.4bnUSD 1.3bn-
    Present Value Of The ForecastUSD 17.3bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta1.183Reported 1.273, pulled toward 1.0 (Blume)
    Cost of equity9.90%Risk-free + beta x equity risk premium
    Cost of debt5.29%Risk-free + 40bp, the spread for a AAA rating at 9.3x interest cover. Book interest / average debt was lower, at 3.3%.
    Market capitalisationUSD 53.1bn88.1% of capital
    Total debtUSD 7.2bn11.9% of capital, book value as a proxy
    Tax rate13.5%Effective, capped at statutory
    WACC9.26%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 70.02

    53% of EV

    Forecast FCFF, final year
    USD 3.0bn
    Capex at depreciation, working capital in reinvestment
    USD 3.6bn
    Less reinvestment at g/ROIC (16.4% of NOPAT)
    USD -592.5m
    Capitalised
    USD 3.0bn
    ROIC (reported)
    15.2%
    Terminal value, undiscounted
    USD 45.7bn
    Terminal value, discounted
    USD 19.7bn
    Enterprise value
    USD 37.0bn
    Less net debt
    USD 4.3bn
    Equity value
    USD 32.8bn

    Exit at 20.0x EBITDA

    Value per shareUSD 118.37

    71% of EV

    Terminal value, undiscounted
    USD 98.2bn
    Terminal value, discounted
    USD 42.3bn
    Enterprise value
    USD 59.7bn
    Less net debt
    USD 4.3bn
    Equity value
    USD 55.4bn

    Spread between methods: 51%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    7.26%95.5498.61102.45107.32113.65
    8.26%79.9381.4983.4285.8288.84
    9.26%68.3669.1070.0271.1772.61
    10.26%59.4559.7160.0760.5461.15
    11.26%52.3852.3652.3852.4752.63

    Outlined: this model. Green text: above today's price of 120.93. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year4.3%5.7%12.0%
    EBIT margin24.0%21.6%35.2%
    Discount rate-9.3%6.6%
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    Yahoo Finance and RBA data. General information, not advice. Methodology.