By Paul R. La Monica

GameStop CEO Ryan Cohen has a bold plan to buy eBay, a much larger company than his. And he's offering a lot of money -- $56 billion, or $125 a share. There's the rub: eBay stock is hovering around $108, a sign that Wall Street doubts Cohen can pull off the deal.

Prominent money manager Bill Smead, whose firm has been an eBay stakeholder for nearly 20 years, is skeptical, too.

Smead Capital Management, which Smead founded, owned about 1.5 million shares of eBay as of the end of the first quarter in the Smead Value Fund, a stake now worth nearly $160 million. Smead said he has owned eBay in the fund since its inception in 2008.

"I don't see any reason for eBay to sell to GameStop," Smead, who is his firm's chief investment officer, told Barron's.

EBay is reviewing the unsolicited offer "to determine the course of action" for it and its shareholders, the company said on Monday.

Smead, like many others on Wall Street, doesn't see how the math would work: GameStop is considerably smaller than eBay. GameStop's market valuation is about $11 billion; eBay's is $48 billion.

Of the $56 billion, GameStop has about $30 billion lined up -- more than $9 billion in cash on its balance sheet and a $20 billion debt financing commitment from TD Securities. In an interview Monday on CNBC, Cohen said GameStop could get the deal done by issuing more stock.

Smead told Barron's that if GameStop had a "legitimate offer" to buy eBay for $125 a share, eBay should consider it.

Still, he said, eBay shouldn't be in a hurry to sell itself since it is doing just fine on its own.

Smead described eBay as "the New York Stock Exchange of preowned items," raking in "loads of money" from transaction fees.

Shares of eBay are up nearly 25% this year and have surged almost 55% in the past 12 months. The stock is trading at around 17.7 times earnings forecasts for this year, well above their five-year average price-to-earnings ratio of 13.2.

Those numbers are another reason why Smead, a frequent contributor to the Barron's Big Money Poll, doubts anyone else would be interested in making a takeover offer for eBay right now.

The company is in a position of strength and the price tag would be steep, he said.

And all this is just fine with Smead. He's content to sit tight.

"EBay is fairly valued if the company remains independent," he told Barron's.

In fact, Smead is more than willing to hold on to a winning name like eBay, which has gone up nearly tenfold since he first bought it, "to a fault."

Also on his list of what he calls "meritorious" stocks: APA and Cernovus, both energy companies; mall owners Simon Property Group and Macerich; home builders D.R. Horton, NVR, and Lennar; and regional bank Fifth Third.

Smead made it clear he's in a wait-and-see mode. He bought eBay a long time ago -- and is in for the long haul.

He isn't looking to make a quick buck from a juicy takeover bid. Anyone who is just might get burned.

Write to Paul R. La Monica at paul.lamonica@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

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May 06, 2026 15:28 ET (19:28 GMT)

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