eBay (EBAY) has been a favorite among binary options traders for some time. One big reason for that is that there’s quite a bit of volatility on the stock as there are strong arguments on both sides of the fence. Today, we’ll talk about the bearish argument, the bullish argument, and what binary options traders should be watching for when trading eBay ahead.
The Bearish Argument On eBay
Those who are bearish on eBay have an incredibly strong argument to be heard. Essentially, they believe that the company is no more than a washed up one hit wonder. You see, no one can deny that years ago, eBay was the king of online retail. The company’s auction system combined with buy now options brought the masses in, and it did incredibly well. However, the bears argue that if you look at trends over the past few years, things have changed in a big way.
In particular, the bears argue that if you’re going to look for strong online retail opportunities, Amazon (AMZN) is the stock to go with. At the end of the day, over the past few years, Amazon has taken a massive portion of the online retail market-share, cutting that chunk out of eBay’s market share and making the company a less competitive force in the market.
All in all, the bears argue that eBay is simply past its prime. Unfortunately, without a proven ability to compete with Amazon and take their market-share back, eBay is destined to under-perform other, stronger opportunities in the market.
The Bullish Argument
While the bearish argument on eBay is indeed a good one, the bulls definitely have a strong voice in this thing as well. You see, the bulls can’t argue that since Amazon became the key player in online retail, they have consistently taken eBay’s market share. However, the bulls also argue that this is likely to change ahead.
At the end of the day, it all has to do with eBay’s architecture. Currently, the company is undergoing massive changes to their system that will lead to a better user experience. As a result, the bulls argue that eBay is going to be taking a good chunk of its market-share back relatively soon. In fact, Ross Sandler, analyst at Barclays recently had the following to offer…
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