Money

If you invested $1,000 in eBay 10 years ago, here's how much you'd have now

Online shopping and auction website eBay turns 24 this week, and for early investors in the company, they also have reason to celebrate the company's anniversary.

If you invested in eBay 10 years ago that decision would have paid off: According to CNBC calculations, a $1,000 investment in 2009 would be worth more than $4,500 as of Sept. 3, 2019, a total return of 350%. In the same time frame, by comparison, the S&P 500 was up nearly 260%. EBay's current share price is hovering around $40.

CNBC: EBay Inc. stock as of Sept. 3, 2019.

When eBay first launched in 1995, it was solely an auction site where sellers could list items and interested buyers could bid on them. Today, the massive online marketplace still offers the auction feature but has strayed far from its original format. Instead of relying on an auction-only model, 89% of eBay's sales are made via the site's "Buy It Now" function, which provides users with a similar experience to buying from Amazon or any other online retailer.

In 2002, eBay acquired PayPal for $1.5 billion. The two companies separated in 2015 but agreed to continue working closely until 2020. The spinoff stemmed from eBay's need to keep up with competitors, such as Amazon, and broaden its payment options for users. For PayPal, a separation meant freedom to pursue future opportunities elsewhere, especially since PayPal was growing faster than eBay prior to the breakup.

Since separating, PayPal's stock has jumped more than 180%, whereas eBay's stock has only risen by around 43%, according to CNBC calculations made on Sept. 3, 2019. In the four years since the split, the two companies are still very much impacting one another.

When eBay announced in 2018 that it would be going with PayPal competitor Adyen to process payments, PayPal's shares plummeted 10%. And in January 2019, PayPal CFO John Rainey told CNBC that lingering ties to eBay still put pressure on business as PayPal continues to handle a portion of eBay's purchasing volumes.

Looking forward, eBay plans to open warehouses across the country for a cheaper, more efficient way for eBay merchants to ship products starting in 2020, the company announced in July.

However, eBay CEO Devin Wenig says he's not "trying to win a fast shipping war," according to Reuters. "Our 182 million consumers shop on eBay because of the value and uniqueness of our inventory. We're not the one-hour delivery guys. We're never going to be that, but consumer expectations are changing."

If you are thinking about getting into investing, experts often advise starting with index funds, which hold every stock in an index, such as the S&P 500. Seasoned investor Warren Buffett agrees that it's a smart idea to start with index funds, in part because they fluctuate with the market, making them less risky than individually selected stocks.

Here's a snapshot of how the markets look now.

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