I seriously enjoy reading Ina Steiner. She's the editor of AuctionBytes.com. I like her stuff because she's just so damn objective. She simply lays out the facts and lets you come to your own conclusions. I also like Ina because she continuously holds a very bright light directly at eBay (NASDAQ: EBAY). Recently, Ina opened the floor at the AuctionBytes blog for discussion about the involvement of Meg Whitman in the Mitt Romney campaign. Needless to say, the situation has raised some eyebrows. Personally, I don't care what direction either Meg or Mitt choose to go. Ina's readers, however, had a very dim view of the situation. My question is, has Meg's insurgence into the political realm affected the shareholders of eBay?
Forget for a moment all the ill conceived plans that eBay has tripped over. Ignore the Skype debacle, the eBay China crash, the silencing of Stubhub and the host of other demons that in my opinion the Whitman crew has set loose, buried or denied. Forget for a moment about all that cash flowing into eBay coffers with nothing better accomplished than to outsource customer service and to pay Whitman's salary. Ignore the wolf at the door in the form of Amazon Inc.(NASDAQ: AMZN). Never mind that eBay has lost its shine and reputation and is yet to pay a dividend to its shareholders. I'm talking about presidential politics and corporate wrangling here.
Rumors claim that Meg Whitman has been penciled into her friend Mitt Romney's potential presidential cabinet. (The worked together at Bain & Co.) Speculation also claims that Meg will be requesting a paid leave of absence from eBay to help Mitt pursue his presidential goal. I say the board of directors at eBay should work in concert to grant Meg her wish, some holding the door whilst the rest appropriately apply a booted foot where a target should have been placed well over two years ago.
Back at the end of October I wrote about the limited risk presented by eBay because of its large footprint. I meant every word when I wrote it, and you'll never know just how hard it was for me to do that. However, things are rapidly changing and I do not now see as much protection for eBay investors simply by virtue of the company's size. eBay's brand image is tarnished, its reputation is trashed, its competition is mounting and now, for her own reasons, Meg Whitman is preparing to bail out. What a shame she would be leaving behind the management team she sculpted and perhaps even her own choice of successor.
Perhaps if I held shares in eBay right now, I'd carefully consider beating her to the door.
Gary Sattler does not knowingly hold positions in the companies he blogs about.
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Reader Comments (Page 1 of 1)
12-27-2007 @ 3:14PM
Mozelle said...
Good job Gary. For once you've spoken the truth. eBay is indeed trashed. Meg Whittman should have been thrown out on her ear a long time ago.
Five years from now eBay will be history!!!
Amazon is the way to go. eBay has lost their luster for millions of people. Their size means nothing. When people stop listing; and they will, people will stop buying; and they will.
I bought nothing from eBay for christmas. Yet I spent well over 1,000 dollars buying on Amazon.com.
eBay sellers pry on innocent, naive buyers. High shipping fees, retalitory negative feedback if you complain, etc...This company is going no where...
Like I said, in five years eBay will be history. Word of mouth is going to put them out of business. Amazon, Google, is the way to go.
Meg Whittman is nothing in her shareholders eyes. She is a DUDD....who has taken this company down.
12-28-2007 @ 2:42AM
anon said...
Don't you think that a Meg departure at this point would be good for the stock?
12-28-2007 @ 4:04AM
Gary E. Sattler said...
In response to comment #2 by anon:
At this point (and prior), I believe that Meg Whitman's departure would be good for the company. Whether it would be good for the stock or not is quite another matter.
eBay in it's current condition and form, is spent. It has been hijacked, pumped and it's burning out. On eBay's current course what do you see that could impress investors enough to really cause a climb in stock value?
I believe that the unceremonious departure of Meg Whitman could cause the stock to jump as much as 10% in one day but I think that would be due to the perceived "breath of fresh air" more than anything.
In the long run,the departure of Meg would mean nothing if eBay itself is left to status quo. It's stock value would most likely reflect that. eBay needs a lot of shaking, a little housecleaning and a deep meaningful and lasting return to it's roots.
Anything less, and we'll see that company fall prey to the vultures in less than three years.
Yep, you can quote me on that.