I think you might be right. I did not like the price action today following the deal. I ran the numbers and they point to a losing acquisition. I sold my long this morning and have been debating going short. After listening to responses on this deal without any analytical merit, I'm feeling short might be the move, especially if the yen rallies. Bulls make money, bears make money, and hogs (most of this board) will get slaughtered.
You "ran the numbers"? And what did they tell you? 12M is less than 1.1B so bad deal for Yahoo? That rhetoric is kinda old (and wrong) so stop playing analyst and pretending you have any clue about this company and how it will react based on the movement of the Yen. You should look outside of the yahoo message boards if you want responses to the tumblr purchase with analytical merit. Getting very tired of the people on this board who don't know jack running their mouths about nonsense. I bet most everyone was saying the EXACT SAME THING 6 months ago when the stock was 1/2 of where it is now. Go look at the old posts.
Sentiment: Strong Buy
YHOO is undervalued compared to other tech stocks and it is still gaining traction on positive cash flow pending a few deals. They have about 5 billion in cash with one of the lowest trailing PE in the industry and a lower than average Future PE compared to the rest of the industry.
Short this and get ready to buy it back at $30.
Sentiment: Strong Buy
You want to see a rocket then look at CSIQ. YHOO is not a rocket and YHOO is not CSIQ. You want 100% return in a month or 2?? Then get in Canadian solar. I told you before at 5 9 days ago and I'm telling you now at 9+. Your choice. Make chump change or make big bucks. Up to you.
I am a value investor looking at Yahoo as a possible turn-around play. All elements are line-up and all they have to do is coming out with products/services and the stock will take off (not counting on IPO and japan although they help but chinese equity can turn negative pretty fast and if the valuation of yahoo depends on IPO of Alibaba is not sustainable). Now they buy tumblr. It's a concern because i rather see them generate growth with the assets they already have, not buying a big bazooka. However, the big bazooka, might be something that yahoo desperately needs right now. Tumblr can be a place to put adsense or add yahoo search or even Google search bar. IF Yahoo keeps this web property away from MSFT, it might give Yahoo more leverage in negotiation with MSFT Google, Facebook, and Apple. I don't know what kind of stuffs Marisa will embed into tumblr, but you can bet that stuffs will be imbedded and David already agreed. Otherwise he'd not have sold tumblr to yahoo. Also, usually the share price of the acquirer drops after the M&A announcement. It's different in the case of Yahoo. SO it either this news was leaked and already priced in, or QEs from Bernanke is the magic, or wall street/analysts are supporting the move, or the financial community is still digesting the news and pondering. What is the probability of each case? I have no idea! Although yahoo share price seems okay at the moment, it might drop a bit or might not, and that might not worry me all that much. What worries me is that if yahoo does not make noticeable improvement by April of 2014, the financial community and the media might not be that supportive. What do you think? By Mr. Woolongtiensinh