Piper Sandler Says eBay + Etsy Could Be Worth $85/Share… Are They High or Onto Something?

Let’s press pause on the usual panic programming (tariffs, inflation, and the ever-growing possibility of 2025 soup lines wrapping around Costco) and talk about something else collapsing under pressure…  the e-commerce identities of eBay and Etsy.

Now, on the surface, these two don’t exactly scream “power couple.” One is an aging online flea market best known for auctioning car parts in the early 2000s, and the other is a former hipster craft haven now being overrun with knockoff merch that probably fell off a Temu truck.

But lately, there’s chatter… like real analyst chatter. Specifically, Piper Sandler has floated the idea that eBay and Etsy should merge. And the more you dig into it, the more it starts to look like the kind of awkward rebound relationship that could actually work out.

Let’s start with Etsy (the company we bought our dogs custom made collar from and my sister would buy handcrafted earrings on all the time) But lately, it’s been having an identity crisis.

In the fourth quarter of 2024, the platform reported a 6.8% decline in gross merchandise sales, totaling $3.7 billion. More concerning is the 10% drop in active sellers, reducing the count to 8.1 million. CEO Josh Silverman candidly acknowledged, "We underperformed the far higher standards we hold for ourselves."

CEO Josh Silverman didn’t pretend otherwise. In a February earnings call, he said, “We underperformed the far higher standards we hold for ourselves” (at least he’s honest).

And buyers have definitely noticed. Etsy’s once-curated charm has been diluted by mass-produced stuff that looks like it came straight from Alibaba. You search for a handmade leather wallet, and you’re met with a wall of plastic lookalikes made in bulk and resold with a "rustic" font.

So what’s Etsy doing about it? Blaming the algorithm. Or rather, trying to become the algorithm. They’re investing heavily in AI-powered personalization. The site now tracks how long you hover over products, what you scroll past, what you linger on (and probably what you had for lunch if they could get away with it). The goal is to make your feed feel like TikTok for handmade goods…  addictive and relevant.

Silverman summed it up by saying, “We have a lot to learn from folks like TikTok and Instagram and Pinterest” (at least he’s on the right track).

Then there’s eBay. The OG of online resale. The platform I remember boomers fought tooth and nail to win a bidding war over a used Scotty Cameron putter (actually this still happens). Today, it still has 134 million active buyers, which is impressive… except for the fact it hasn’t grown in years.

While eBay’s been busy counting its users, competitors like Temu and TikTok Shop have shown up to eat its lunch, dinner, and leftover snacks. User growth has flatlined. Engagement is fading into the abyss. And somehow the interface looks like it was last updated during Obama’s first term.

But eBay isn’t giving up without a fight. It’s building out AI tools too, rolling out “feed-like” shopping experiences and algorithmic outfit pairings. Their Chief Product Officer Eddie Garcia said, “The game changes so quickly with AI… in five or 10 years, every person has their own personal eBay.” That’s a lot of confidence coming from a company that still can’t recommend a belt that matches the shoes in your cart.

This is where the merger talk comes in. Piper Sandler crunched the numbers and concluded that this unlikely combo could actually unlock some real value. By combining eBay’s massive user base with Etsy’s niche appeal, the merged company could have a pro forma buyer base of 174 million people… roughly 60% the size of Amazon’s.

They estimate the deal could generate $0.78 in EPS accretion by 2026. And if all goes to plan, the combined entity could be valued at $85 per share, compared to eBay’s current $66 and Etsy’s $47. That’s a decent payday for two platforms whose best days may be in the rearview mirror.

If you think about it… strategically, it makes sense. Etsy needs scale, more frequent buyers, and deeper data. eBay needs fresh energy, cultural relevance, and a brand people under 40 still remember exists. Etsy brings a loyal, creative seller base. eBay brings reach and infrastructure. Together, they might actually stand a chance against Amazon and Temu.

Whether or not this will happen is up in the air, but the fact that the idea’s even being floated tells you everything you need to know about where both companies stand. Etsy is trying to rediscover its identity. eBay is trying to stay out of the internet’s retirement home. And neither of them can afford to keep pretending like Temu isn’t breathing down their necks with 2-day shipping and $3 smartwatches. 

At this point, they might as well take Piper Sandler’s advice and do it. Merge, partner, whatever… just something. Because if eBay and Etsy don’t evolve (like now), they’ll get forgotten.

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