We recently published a list 10 Best Gig Economy Stocks to Buy. In this article, we will see where eBay Inc. (NASDAQ:EBAY) stands against the best gig economy stocks.
The Rise of the Gig Economy
The pandemic era has been heralded as one of the most profitable periods for gig economy stocks, as more and more people begin to pick up remote work opportunities through online platforms to connect service providers and clients. But even before that, the gig economy has become an important part of the market since, at any time, there will be a massive cohort of people who simply want to be their own boss – the pandemic only facilitates this type. people to shine bright.
Post-pandemic, when people start to realize that they can, in fact, work from home, gig economy companies can retain their profits. Even after returning to the office, many people decide to stay with remote work opportunities provided by well-known online platforms. According to Michael Morton, Senior analyst at MoffettNathanson, the main reason why gig economy stocks have performed well in the market this year is that the perception of investors about this business is changing. Previously, investors were less inclined to gig economy companies because they used to focus too much on growth and not enough on profitability. However, Morton believes that companies that change this approach to do the opposite now – focus on profitability is now overruling that on growth.
Secular Tailwinds and Risks for Gig Economy Businesses
Morton believes the well-known gig economy business in the transportation and food delivery space is a promising business set to benefit from secular tailwinds. The biggest tailwind for such businesses is their expansion into large, untapped, addressable markets. Although there is a level of risk attached to these new businesses when large gig economy players begin to aggressively pursue these opportunities with high levels of investment, there is room to argue that these investments will be in the general interest of the businesses that do. tap into markets that have been neglected – think Southeast Asia, India, Latin America, and Africa.
Another risk that some people see for gig economy businesses is in the regulatory domain. Morton believes that the services provided by these companies to customers are important enough to require a cooperative attitude from regulatory bodies around the world, because they not only offer what is now considered an essential service but also provide a way to generate additional income for their employees. . At the same time, most of your gig economy players with operations in up to 70 countries have also demonstrated the ability to work with various regulatory landscapes.
These factors have worked wonders in terms of eliminating investors’ concerns about gig economy stocks, a development that has led to more confident investors buying into these businesses. As a result, the popularity of these stocks is only increasing, which is why we’ve compiled a list of some of the best gig economy stocks to buy right now.
Our methodology
We sifted through ETFs and online rankings to compile an initial list of 20 gig economy stocks. We then select 10 gig economy stocks with the highest number of hedge funds holding stakes in them, as of Q2 2024. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them.
Why do we focus on stocks that hedge funds pile into? The reason is simple: our research shows that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter strategy picks 14 small-cap and large-cap stocks each quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points. (see more details here).
A close up view of the customer’s phone, using the mobile app to purchase the product.
eBay Inc. (NASDAQ:EBAY)
Number of Hedge Fund Holders: 38
eBay Inc. (NASDAQ:EBAY) is another e-commerce player on our list. It runs a marketplace platform that connects buyers and sellers globally, like Etsy, and in doing so, significantly facilitates the gig economy by allowing sellers around the world to run their own businesses from home.
In the third week of September, eBay Inc. (NASDAQ: EBAY) hit its 52-week high with a share price of $64, outperforming the broader market. At the same time, the company has been buying back its shares since 2023. Last year, eBay Inc. billion shares.
This buyback activity highlights the company’s belief that eBay Inc. (NASDAQ:EBAY) is currently undervalued in the market. With a P/E ratio of 13.2 versus the sector median of 17.4, this conclusion seems to be correct. With inflation continuing to cool down, many investors think that e-commerce players are beginning to see great attention and enthusiasm as well, which could mean that eBay Inc. (NASDAQ: EBAY) is finally getting the attention it deserves.
A total of 38 hedge funds were long eBay Inc. (NASDAQ: EBAY) in the second quarter, with a total stake value of $924.6 million.
Overall, EBAY rank 7 on our list of the 10 Best Gig Economy Stocks to Buy. While EBAY is an outstanding investment, we believe that AI stock holds the promise of delivering high returns and doing so in a shorter time frame. If you’re looking for AI stocks that are more promising than EBAY and are trading at less than 5 times their earnings, check out our report on the cheapest AI stock.
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Disclosure: None. This article was originally published on Insider Monkey.
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