Jerry Yang: Throne of Blood
by John Paczkowski
Posted on October 16, 2008 at 8:11 AM PT
Yahoo is certainly embracing its new market underperform rating, isn’t it? With rumors of December layoffs in the wind, shares in the company are trading in the $11 range today, after dipping below $12 Wednesday to yet another new 52-week low. That’s about half the price that Mithras Capital Partners suggested Yahoo sell itself to Microsoft last week, a little more than a third of Microsoft’s (MSFT) $31-per-share offer, which Yahoo CEO Jerry Yang claimed “massively undervalued” it, and almost a quarter of the $40-a-share valuation Yahoo believed it deserved.
Appalling. At $11.51, Yahoo’s (YHOO) stock price at this very moment, the company is trading at well below replacement value. “Spend $15 billion, and you could not build a new Yahoo today–not one with this global reach and brand,” Henry Blodget notes over at Silicon Alley Insider. “Wringing compelling upside out of the stock at $12 is not rocket science. At this price, it’s not even basic arithmetic. So we say again: Yahoo at $12 is ridiculous.”
Ridiculous, indeed. Perhaps the government will come along and offer Yahoo a nice $31-per-share bailout–you know, just to bolster investor confidence.
Comments
Silicon ALLEY Insider.
Yahoo is trying to bring back that old Steve Martin routine: “Get Small”.
Posted by Mac Beach at October 16th, 2008 at 11:00 amThe only bad thing is if some tall people come over…
Posted by John Paczkowski at October 16th, 2008 at 11:04 amthe value of yahoo is as “going concern” and that means future revenue and profits and not a “brand” as has been mentioned
the brand is worth zero unless yahoo can compete in search and advertising — both areas it lags painfully
over 40% of yahoo users use it for free web email
other than that there’s not a lot at yahoo to actually do
jerry and the team have some real soul searching to do, they’ve cruised along the past 8 years playing golf and goofing off
now there lack of attention shows
Posted by Sam Harrison at October 31st, 2008 at 12:47 pm