Piper Sandler is proposing a potential merger between e-commerce players eBay (NASDAQ:EBAY) and Etsy (NASDAQ:ETSY), citing complementary strengths that could address growth challenges and create a stronger rival in the space.
In a new report, the investment bank said combining eBay's 134 million active buyers with Etsy's niche marketplace could help the companies scale and compete more effectivelyreaching nearly 60% of Amazon's buyer base.
The firm suggests an all-stock transaction could value the combined entity at $85 per share and add $0.78 to earnings per share by 2026. However, Piper Sandler acknowledged that such a deal remains unlikely in the near term.
While the numbers may support the logic, the two companies operate with distinct business models. Etsy focuses on handmade, vintage, and craft-oriented goods, while eBay's marketplace spans nearly every consumer category and operates in over 190 global markets. eBay's roots date back to 1995, while Etsy launched in 2005 and went public in 2015.
In terms of recent performance, eBay has outpaced Etsy significantly. Over the last five years, eBay shares have gained 134%, while Etsy is up just 21%, underlining the different growth trajectories the two companies have experienced.
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