Value-Driven Assortment Should Render eBay More Downturn Resistant Than Market Prices Suggest

With divestitures of Stubhub, eBay Classifieds, and eBay Korea largely in the rearview mirror, narrow-moat eBay's business looks remarkably similar to its genesis: a lively e-commerce platform connecting hundreds of millions of buyers and sellers worldwide, with an emphasis on used, liquidation, and refurbished goods. The firm's strategic pivot strikes us as a competitive necessity, with unsuccessful forays into logistics and first-party inventory, and auxiliary services seeing the bulk of business-to-consumer, or B2C, sales migrate toward larger peers with sprawling store footprints, scaled fulfillment networks, or extensive buyer and seller features. Nonetheless, the core eBay Marketplace business should have plenty of room to run, considering management's estimated $500 billion total addressable market for non-new, seasoned goods (which comprise 90% of platform GMV), and could benefit from swelling interest in resale markets and a broader rollout of the firm's focused category approach (targeting 50% of gross merchandise volume, or GMV, in those categories by 2025).