Thats interesting. That is not what the company or analysts are forecasting. I imagine they will dilute the stock again to "purchase" another company to have another 18 months of the "integration" excuse. I think the upside in this stock is being bought out/patents, especially for their presence in foreign markets. While I think there is real upside, I don't think its in the company "turning a corner." I also am very frustrated by the amount of stock dilution from management. Without going back and looking I believe its roughly 15% a year.
There are a lot of opinions that "nothing has changed since yesterday." That sentiment couldn't be further from the truth. Below is what has changed:
1) YHOO announced it will return 100% of its BABA interest to YHOO shareholders. That is major news. There was a general belief that approximately half of the interest would be used to make acquisitions.
2) We now know for certain that the BABA shares will be given tax free.
3) As it stands today, the BABA interest is worth 40B. YHOO's market cap is 46B. There are approximately 1B shares of YHOO and YHOO now owns approximately 380M BABA shares. In round numbers, for every 3 shares of YHOO you will get one share of BABA (via SpinCo).
The important details have been released: Every dime of BABA holdings will go to SpinCo, it should be completed by the end of Q4 2015, YHOO holders will be given shares of SpinCo so that all of the BABA shares are returned to YHOO investors. Details can't be given with more specificity as so much depends on the stock price of BABA as well as the number of outstanding shares of YHOO. At the present time, in rough numbers, for every $1 in YHOO you own you will be getting $1 in SpinCo.
Its a smart play in Roth IRA. Make sure there are no issues in terms of the spin off.
Rough math, but the market cap is 45B. The stake in BABA is 40B. Expect to see YHOO go down eventually, with SpinCo going way up. Together, I expect each current share to be worth $70.
I think a fund/wealthy person is purchasing. With such a low market cap a million+ dollar purchase will move it a lot.