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eBay’s Buyback in Perspective

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50 million shares repurchased since the beginning of the year

In 3Q17, eBay (EBAY) repurchased shares worth $907 million and, in turn, removed 25 million common shares from circulation. The company spent $507 million on buybacks in 2Q17, and it removed 15 million shares from the market.

From the beginning of the year until the end of 3Q17, eBay has eliminated roughly 50 million shares from circulation and spent about $1.8 billion on share repurchases. In 2Q17, the company boosted its repurchase budget by $3.0 billion, adding to the $479 million that was remaining under the previous repurchase authorization. So, after spending $907 million on repurchases in 3Q17, $2.6 billion still remained on eBay’s current buyback authorization.

eBay’s buybacks and stock movements

When eBay was reporting its 3Q17 results on October 18, its shares had risen 27.9% since the beginning of the year. At the time of reporting the 2Q17 results on July 20, shares had risen 25.2% since the beginning of the year. These movements suggest that investors who got into eBay stock at the beginning of the year and participated in the 2Q17 and 3Q17 buyback programs booked gains on their investments in the stock.

Comparing and contrasting e-commerce stock movements

But eBay isn’t the only e-commerce company whose stock has largely trended upward so far this year. Amazon (AMZN) was up 26.7% from the beginning of the year to the time the company reported its 3Q17 results on October 26. Alibaba (BABA) was up 110.5% from the beginning of the year to the time the company released its fiscal 2Q18 (September quarter) results on November 2.

JD.com (JD) reported its 3Q17 results on November 13 and, at the time, its stock had risen 62.5% from the beginning of the year. Yelp (YELP) and Groupon (GRPN) both reported their 3Q17 results on November 1 and at that time their shares had climbed 20.7% and 54.2% since the beginning of the year.

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