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Pioneer Natural Resources Co. Message Board

baconcc 4 posts  |  Last Activity: Jul 16, 2014 11:08 AM Member since: Mar 16, 2013
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  • Here is what Yahoo could do to really boost the stock price:

    Instead of selling BABA share at the IPO price, distribute the BABA shares to the YHOO shareholders.

  • Based on old economics, everyone is overpaying for everything nowadays. Sure, back when you could earn 5-10% interest on cash and borrowing costs were 2-3 percentage points above that, these investments did not make sense. However, borrowing costs are near 0% and return on cash is about the same. In today's economy any positive return is an improvement over doing nothing. Fear is still holding the economy back from booming. Interest rates have never been lower, so these times have never been seen before.

    Most individuals and companies do not know how to operate in a zero interest rate environment.

    The proper approach is to apply maximum leverage and buy everything in sight.

    For those who have done this, the last 5 years has been an incredible ride, which will never be seen again by those who are living.

  • Value of Yahoo :12x $1.20/share = $12
    Value of Yahoo Japan = $4
    Value of Alibaba shares = $42
    Loss on acquisitions made after blowing the Alibaba cash = -$25
    -----------------------------------------------------------------------------------------
    = $33 per share

    If they announce or hint of more stupid acquisitions while valuations are so high that will hurt the stock price even more.

    Yahoo is perceived like a typical lotto winner who gets the windfall, blows all the money and ends up broke in 2-3 years.

    Sentiment: Hold

  • Reply to

    WSJ has yahoo's core valued at 4.71 billion

    by j.spatta May 9, 2014 5:06 PM
    baconcc baconcc May 9, 2014 11:13 PM Flag

    The problem is that yahoo will spend the windfall on a bunch of acquisitions that end up being worth nothing. There is only so much advertising $$ out there to be had. There are far too many internet companies chasing far too few advertising dollars. It is inevitable that the cost of advertising on the net will go down because the supply is spinning out of control. I just don't see internet advertising as having solid long term revenue growth potential. Yahoo should think of something else to do with the money rather than buy a bunch of internet advertising companies.

    Sentiment: Hold

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