eBay: The Sweetheart of the Fund Managers

eBay (EBAY Quote) shareholders' proxy proposal votes will be announced later this week. But institutional investors have already been voting with their pocket books.

In the first quarter, more than 200 institutional investors -- mutual, index and pension funds -- either bought into eBay or increased their stakes in the online auctioneer, according to FactSet Research Systems' LionShares site. The net holdings in eBay of such investors increased in the first quarter by about 11.8 million shares, a stake that is now worth about $1.2 billion.

Much of the buying appears to have come from index funds that bought up eBay stock as it soared compared with the rest of the Nasdaq 100. But some also seems to have come from portfolio managers eager to pick up an Internet winner.

Forget about the company's sky-high valuation or its profligate use of stock options, analysts say. Investors are ignoring anything negative about eBay right now, they say. ...