Financial Analysis E-bay

EBay, the market leader in online auctions, has experienced tremendous harvest-festival since 1996. The pursuit numbers from Exhibit 1 demonstrate eBays youthful harvest: - The number of users rose from 41,000 in 1996 to 10,006,000 (525% yearly crop rate) - Merchandise sales emergenced from $7 trillion in 1996 to $2.8 gazillion (637% annual emergence rate) - The number of auctions jumped from 289,000 in 1996 to 129,560,000 (665% annual growth rate) The chart below focuses on the of the essence(p) balances and figures used for completing a financial analysis for eBay.         1996         1997         1998         1999 lettuce Revenue Growth         N/A         29.1%         108.2%         160.9% Operating put on (as % of receipts)         20.0%         25.9%         14.8%         -5.2% Operating get down (as % of revenue)         58.7%         55.1%         66.5%         75.0% primitive sales and Marketing Expense (as % of revenue         41.0%         37.8%         41.8%         43.0% Marketing Expense/Customer (regular users)         $320         $45.80         $16.50         $9.59 Marketing Expense/list         $45.46         $3.55         $1.07         $0.74 relapse on Assets (Net Income as % of Assets)         N/A         125.6%         4.9%         1.1% Return on comeliness (Net Profit as % of Equity)         N/A         695.7%         7.2%         1.3% Current ratio         N/A         4.42         3.96     Â Â Â Â Â 5.17 Debt to Asset Ratio Â!  Â Â Â Â Â Â Â N/A         0.10         0.33         0.03 Debt to Equity Ratio         N/A         0.55         0.006         0.006 interchange and Cash Equivalents (000s)         N/A         3,723         37,285         219,679 Short-term investments (000s)         N/A         N/A         40,401         181,086 The financial statements of eBay in Exhibits 3 and 4 find out that revenue increased from $32,051,000 in 1996 to $224,724,000 in 1999, while lucre income for the same period increased from $3,338,000 to $10,828,000. EBays revenue growth in 1999, from the previous year, had an astonishing increase of 160.9%. However, for the first era in the history of eBay, a disallow in operation(p) gather occurred in 1999. After careful question of the ratios and figures, the neg ative operating profit can be in the main attributed to readily rising operating expenses compared to revenues and the ever-increasing hyper-competition in the online auction industry. Sales and marketing expenses have stayed constant compared to... If you want to get a beneficial essay, order it on our website: OrderCustomPaper.com

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