Using an unlevered Free Cash Flow to Firm (FCFF) model, we project eBay Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 8.1% to 4.3% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 37, DPO 63, DIO 60). At a 8.1% WACC with mid-year discounting, the terminal value (81% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 13.8x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $99.59 per share, suggesting EBAY is fairly valued by 11.5% at the current price of $89.35.
Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.
| 2026 | 2027 | 2028 | 2029 | 2030 | Terminal | |
|---|---|---|---|---|---|---|
| Profit Before Tax | 2,896 | 3,034 | 3,156 | 3,298 | 3,441 | 3,527 |
| (−) Net Interest | 295 | 310 | 322 | 336 | 351 | 360 |
| (+) D&A | 466 | 486 | 509 | 536 | 567 | 582 |
| EBITDA | 3,658 | 3,829 | 3,987 | 4,170 | 4,359 | 4,468 |
| (−) Tax | 640 | 670 | 697 | 728 | 760 | — |
| (−) CapEx | 541 | 566 | 589 | 616 | 642 | — |
| (−) ΔWC | 1,431 | 57 | 50 | 58 | 59 | — |
| Free Cash Flow (FCF) | 1,047 | 2,536 | 2,651 | 2,768 | 2,898 | — |
| Peers' EBITDA Multiple | 13.8x | |||||
| Terminal Value | 61,529 | |||||
| WACC / Discount Rate | 8.08% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 1,007 | 2,257 | 2,183 | 2,109 | 2,043 | 41,714 |
| Enterprise Value | 51,312 | |||||
| Projection Period | 9,598 | 18.7% | ||||
| Terminal Value | 41,714 | 81.3% | ||||
| (−) Current Net Debt | 5,509 | |||||
| Equity Value | 45,803 | |||||
| (÷) Outstanding Shares | 460M | |||||
| Fair Price | $100 | +11.4% | ||||
| WACC \ EV/EBITDA Exit Multiple | 9.8x | 11.8x | 13.8x | 15.8x | 17.8x |
|---|---|---|---|---|---|
| 6.1% | $81 | $95 | $110 | $124 | $138 |
| 7.1% | $77 | $91 | $104 | $118 | $132 |
| 8.1% | $73 | $86 | $100 | $113 | $126 |
| 9.1% | $70 | $82 | $95 | $108 | $120 |
| 10.1% | $67 | $79 | $91 | $103 | $115 |
Current price: $89.35. Green = undervalued, Red = overvalued.
Based on default parameters
This is an unlevered Free Cash Flow to Firm (FCFF) model with a 5-year projection period. Revenue, expenses, D&A, and working capital are projected using the same line-by-line approach as the Growth Exit models. The key difference is the terminal value methodology: instead of assuming perpetual cash flow growth, the terminal value is calculated by applying the industry peer median EV/EBITDA multiple to the projected Year 6 EBITDA.
Using a peer exit multiple anchors the terminal value to how the market currently prices comparable companies, rather than relying on a theoretical perpetual growth assumption. This approach captures relative valuation dynamics and is particularly useful when a company is expected to converge toward industry-average profitability over time. The sensitivity matrix shows how fair value changes across different WACC and EV/EBITDA multiple scenarios.