GME and EBAY - A Lesson in Accretive Acquisitions

=== SUMMARY === - The post analyzes GME's proposed half-cash/half-stock acquisition of eBay, arguing the deal is accretive for existing GME shareholders despite issuing ~1.2 billion new shares. - Author uses combined EBITDA minus interest to show a 25%+ increase in per-share earning power, and adds Ryan Cohen’s projected $2B cost savings (discounted to $1B) to claim a 125% profit increase. - Quality assessment: Speculative analysis with significant flaws (EBITDA as profit proxy, ignoring taxes, optimistic synergy assumptions); community comments highlight standard corporate finance counterarguments and execution risk. === SENTIMENT === MIXED === TRADE IDEAS === TICKER - GME - LONG | confidence: 0.35 | sentiment: +0.30 Speaker: u/mike-some Thesis: 1. THE FACT: Author calculates GME shareholders would own 25% of combined entity with post-debt EBITDA of ~$1.25B; even without cost cuts, per-share earnings increase 25%. 2. THE BRIDGE: If Ryan Cohen achieves even $1B in savings, GME shareholders see 125% profit upside, implying significant undervaluation of current GME stock relative to future earnings. 3. THE VERDICT: Trade based on belief that the deal is accretive and cost synergies materialize, making GME a deep value play. 4. RISKS: Deal may not close; eBay shareholders may prefer all-cash buyer; debt load ($2B annual interest) is heavy; cost cutting could destroy revenue; community notes using lower-EPS stock to buy higher-EPS is trivial accretion, not value creation. Timeframe: medium-term Key Points: - Accretive only if synergies real - Heavy debt burden risk - Community skeptical of assumptions - Deal structure dilutes GME holders 75% - Need to monitor Cohen's execution === COMMENTS SUMMARY === Community counters the author’s bullish thesis: top comment notes using lower-EPS shares to buy higher-EPS is basic corporate finance, not special value creation. Another criticizes using EBITDA as profit, ignoring taxes, and underestimating interest. A third questions