Gauging Future Growth Areas for eBay

eBay EBAY, which competes with other e-commerce sites like Amazon.com AMZN, Walmart WMT, Overstock.com OSTK, and Blue Nile NILE, recently held an Investor Day in which the company discussed future growth areas and presented its business outlook through 2013. One notable highlight of the presentation was the company's expectation of rapid growth from its PayPal, Bill Me Later and StubHub businesses. Here we examine eBay's growth areas in detail and the potential upside that it could add to our $32.81 stock price estimate, which stands slightly below market price. PayPal already serves an estimated 59 out of the top 100 merchants in the U.S., and the company expects that PayPal will be able to gain market share in the online payment market from around 14% in 2008 to 22% in 2013. The company also expects that PayPal's penetration on eBay could increase from 58% in 2008 to around 80% by 2013. Continue reading the article.