Bloomberg News

EBay Inc. (EBAY - Get Report) said Tuesday that it would "carefully review" proposals from an activist investors, Elliott Management, after a letter outlining significant changes to its business model pushed shares to the highest level in four months.

EBay said both its board and its leadership team "regularly engage"with shareholders and value their input following a letter from Elliott that pressed online marketplace to adopt a plan to increase shareholder value, accusing management of "underperforming its peers and the market for a prolonged period of time."

"We are focused on delivering value for our shareholders, customers and employees by driving the best choice, the most relevance and the most powerful selling platform to deliver growth," eBay said in a statement. "Accordingly, we appreciate Elliott's recognition of the strength and power of eBay's business and will carefully review and evaluate Elliott's proposals. We look forward to the opportunity to engage with Elliott, as we do with all shareholders."

EBay shares rose 6.1% to close at $32.90 in trading on Tuesday, a move that takes the stock back to levels last seen in late September and values the San Jose, Calif-based group at just over $33 billion.

Elliott, which said it controls a 4% stake in eBay worth more than $1.5 billion, said management should "turn its singular attention to growing and strengthening marketplace", asserting the group is "far from broken, and its future should be bright".

Elliott's five-step plan, the activist said, outlines a value creation opportunity that would take the path of Ebay shares to between $55 and $63 each by 2020.

"Despite its remarkable history as one of the world's largest e-commerce platforms, eBay as a public-company investment has underperformed both its peers and the market for a prolonged period of time," Elliott said in a letter to the company's board of directors. "While eBay's core Marketplace continues to enjoy sustained growth and the two other franchises that eBay owns, StubHub and eBay Classifieds Group, are thriving, eBay suffers from a deeply depressed valuation due to its history of misexecution."

"Elliott believes that eBay is worth far more - but change is urgently needed to address both public perceptions and real business issues," the letter said, adding that Elliott wants eBay to engage in a "full operation review of how it spends and develops its funds", with an aim to increase operating expenses by $250 million from 2018 to 2021.

It also said eBay's event ticketing business, StubHub, has a value of between $3.5 billion and $4.5 billion, compared to a range of $8 billion to $12 billion for the group's classified advertising division.

The Wall Street Journal reported that another activist investor, Starboard Value LP, has built a similarly-sized stake in eBay and may push for the group to spin off StubHub and the classifieds division in order to create more shareholder value.