Facebook Inc (FB) Covets eBay Inc (EBAY)’s Paypal: Bill Smead


Bill Smead of Smead Capital Management was on CNBC’s Squawk box earlier today and he was asked about his favorite stock. eBay Inc (NASDAQ:EBAY) was one of his most favorite stocks and while discussing about the prices of the stocks today, he started referring to the note written by David Marcus to the eBay Inc (NASDAQ:EBAY) employees before he joined Facebook Inc (NASDAQ:FB).He was surprised by the note and this is what he said:

“In a tech world if you work in a company for three years, they write a 30 year letter because they worked there for 3 years! Stop and think about Facebook, Apple, Amazon, Google, they all covet Paypal.”

Facebook Inc (NASDAQ:FB), eBay Inc (NASDAQ:EBAY), Bill Smead

The reason as per Smead for all the companies trying to covet the eBay Inc (NASDAQ:EBAY) subsidiary is because it dominates the payment system. Smead believes that Paypal is the most popular, widely used and most secure payment system. He also pointed to the latest hire at Facebook Inc (NASDAQ:FB) and here is what he mentioned exactly:

“It’s (Paypal) the most popular, widely used and most secure payment system. So if Facebook hires the guy that was running it, what does that tell you about Facebook’s intentions? Oh he is coming here to do messaging. Really! Are they going to generate a lot of revenue out of that? Or are they going to be one of the three companies that’s trying to buy eBay and they just want to have the guy running it sitting in the house.”

Smead also said that all these companies are looking get Paypal and that they are not really interested in the market place business. He also pointed out how eagerly every one of the major bidders want the payment business of eBay Inc (NASDAQ:EBAY) and whoever goes into the payment business, ultimately eBay Inc (NASDAQ:EBAY) goes down and Facebook Inc (NASDAQ:FB) might become the biggest bidder with Marcus joining the company who had good hold on Paypal.

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