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YHOO - the bull case
- Thread starter xxxskier
- Start date
the hype is about how quickly the Alibaba Group (Alibaba.com is only one of 5 co.s in the group that is going public) has gained traction in china and how quickly revenue has grown. do a search for articles on alibaba growth....i think profit doubled or tripled yoy.
Yaho owns 40% of the Alibaba Goup, and the group is actually 5 different businesses. Right now the group CEO, jack Ma, is bringing only one of the busiesses, alibaba.com, public. and he's only floating 17% of that. this 17% is now subscribed at 1.5B. which means that just this one co. within the Alibaba group is now valued at 8.7B....and yahoo owns 40%. even if Alibaba IPO remains flat after the open, yahoo's balance sheet will show a 3.B gain in assets.
some simple math shows what all the excitment is about: yahoo's 40% (which was an original 1B investmet two years ago) is now worth aboout 3.5B. and it doesn't stop there. jack ma is planning on at least one more IPO by spring 09, and i've heard it will be the taobao.com business.
now here's the best part....... each time one of the 5 companies within within the alibaba group goes public, yhoo still owns 40% of it.
while yahoo was asleep at the wheel regading its own business and letting goog come from behind and pass them up inthe past few years, yhoo did happen to make this Alibaba investment that prove to one of the most, if the best decision theyever made.
by default, yhoo could very easily become the biggest china play yet.
now, the momentum in yhoo i snot alibaba. they did just beat )lowered) expectaions. i follow this industry very closely and am very famliar with it. ...and when yhoo reported significant increased RPS (revenue per search) last EA, it was very important. it shows there new searcch ad platform is finally working well. the laast piece of the puzzle is for yhoo to increase search volume.... and that can be accomplished with somead campaigns. of course it takes money to advertise, but with yhoo's new 3.5B (low ball estimate assumes IPO remains flat)...i expect them to market their services very aggresively in 08.
and there is always the buy-out rumors surounding yhoo.
given all the above, yhoo is an incredible risk:reward long term investment.
Yaho owns 40% of the Alibaba Goup, and the group is actually 5 different businesses. Right now the group CEO, jack Ma, is bringing only one of the busiesses, alibaba.com, public. and he's only floating 17% of that. this 17% is now subscribed at 1.5B. which means that just this one co. within the Alibaba group is now valued at 8.7B....and yahoo owns 40%. even if Alibaba IPO remains flat after the open, yahoo's balance sheet will show a 3.B gain in assets.
some simple math shows what all the excitment is about: yahoo's 40% (which was an original 1B investmet two years ago) is now worth aboout 3.5B. and it doesn't stop there. jack ma is planning on at least one more IPO by spring 09, and i've heard it will be the taobao.com business.
now here's the best part....... each time one of the 5 companies within within the alibaba group goes public, yhoo still owns 40% of it.
while yahoo was asleep at the wheel regading its own business and letting goog come from behind and pass them up inthe past few years, yhoo did happen to make this Alibaba investment that prove to one of the most, if the best decision theyever made.
by default, yhoo could very easily become the biggest china play yet.
now, the momentum in yhoo i snot alibaba. they did just beat )lowered) expectaions. i follow this industry very closely and am very famliar with it. ...and when yhoo reported significant increased RPS (revenue per search) last EA, it was very important. it shows there new searcch ad platform is finally working well. the laast piece of the puzzle is for yhoo to increase search volume.... and that can be accomplished with somead campaigns. of course it takes money to advertise, but with yhoo's new 3.5B (low ball estimate assumes IPO remains flat)...i expect them to market their services very aggresively in 08.
and there is always the buy-out rumors surounding yhoo.
given all the above, yhoo is an incredible risk:reward long term investment.
Quote from xxxskier:
...yhoo did happen to make this Alibaba investment that prove to one of the most, if the best decision theyever made.
most definitely.
And with this ipo, just one subsidiary is now valued at $8.8b. Because of the demand, I wouldn't be surprised if this doubles on the first day of trading. Anyway, yahoo's share for now is about $3.9b just for that subsidiary alone. And there's still 4 other major subsidiaries that will go public, of which talk is taobao goes public in spring (already has 85% market share of the china online consumer auction market). Then there's alipay, which is the paypal of china. Imagine how much this company will be worth in a year or two; absolutely huge.
Finally, it does look like the yahoo search operations is making a turnaround. panama is now operational. But i think they could add alot more shareholder value by taking dramatic measures (eg too many employees. I think they have about 2x as many as google yet 9/30 YTD revenues generated was only 1/2 of googles). The new ceo's 100 day review is now about over. Let see what he will do. Yahoo's prospects are looking pretty good right now.
no, goog has more ees then yhoo...about 2,000 more.....13k vs 11k. yhoo doing a big lay-off like AOL is now doing will not help yhoo. yhoo needs to better monetize its traffic, not reduce expenses by a lay-off....that is is very short-sighted. i've heard from my sources that jerry yang is re-deploying troops to focus on the more lucrative parts of the biz..
the 100 day plan is hype. that was jerry's, "i'm a new ceo and need to buy some time" comment. the 100 day plan is now just a media thing.
the 100 day plan is hype. that was jerry's, "i'm a new ceo and need to buy some time" comment. the 100 day plan is now just a media thing.
It's really pretty simple. Forget about PE's and all that stuff.
Yhoo owns 40 percent of a China Ipo that represents multiple China Corps!
If YHOO trades half as good as any other No name China IPO that has traded up significantly this year - Yhoo should be good for at least 50 a share easy.
everyone wants a' "real "CHINA play.. Now they have found it in YAHOO.
This is going to 50 by year end.!
Yhoo owns 40 percent of a China Ipo that represents multiple China Corps!
If YHOO trades half as good as any other No name China IPO that has traded up significantly this year - Yhoo should be good for at least 50 a share easy.
everyone wants a' "real "CHINA play.. Now they have found it in YAHOO.
This is going to 50 by year end.!
Quote from xxxskier:
no, goog has more ees then yhoo...about 2,000 more.....13k vs 11k. yhoo doing a big lay-off like AOL is now doing will not help yhoo. yhoo needs to better monetize its traffic, not reduce expenses by a lay-off....that is is very short-sighted. i've heard from my sources that jerry yang is re-deploying troops to focus on the more lucrative parts of the biz..
the 100 day plan is hype. that was jerry's, "i'm a new ceo and need to buy some time" comment. the 100 day plan is now just a media thing.
google hired like mad particularly in Q2. That's why they missed their numbers then. Yahoo employees were more than googles at least earlier in the year. So when they are in exactly the same business and google is generating a lot more per employee (granted google's growth rate is higher), i don't think it is shorted sighted at all to review and take action where there are non-productive assets concerned. But i agree on your point they do need to better monetize their assets.
ps not getting much discussion from other people but the view count for this thread is quite high...
There is plenty of room for GOOG and YHOO to exist ion the same place..They don't to have cannibalize each other.
I think Yhoo is a bit better a research etc Googe is better at search for now..
People believed at one time that goog was to rule the world. now people are waking up. They said this about IBM and Microsoft. Now look at them the coexist .msft major competitor is apple hpq orcl for ibm etc..
And remember DELL in the 90's .. Times are changing yhoo is getting lean and mean. Sooner or later the shear size of google they will have to run its company like a normal business, the chefs and cooks will go back Macdonald's. .
I think Yhoo is a bit better a research etc Googe is better at search for now..
People believed at one time that goog was to rule the world. now people are waking up. They said this about IBM and Microsoft. Now look at them the coexist .msft major competitor is apple hpq orcl for ibm etc..
And remember DELL in the 90's .. Times are changing yhoo is getting lean and mean. Sooner or later the shear size of google they will have to run its company like a normal business, the chefs and cooks will go back Macdonald's. .
aapl is an interesting analogy as well. they brought back jobs back (he was the founder) as ceo as appl was being written off. now look at appl.
last month jerry yang had a meeting with all mgmnt...vp level and above. jerry brought in jobs to rally the troops. i have a few good froends that were in the room when steve walked in...an audible gasp ws heard in the room. the buzz within mgmnt as well as the rank and file is that yhoo is getting its mojo back. they've even hired some former googlers (ex-google employees who cashed out their fully vested options..3 year vesting period).
the short's wet dream party at yhoo is over.
last month jerry yang had a meeting with all mgmnt...vp level and above. jerry brought in jobs to rally the troops. i have a few good froends that were in the room when steve walked in...an audible gasp ws heard in the room. the buzz within mgmnt as well as the rank and file is that yhoo is getting its mojo back. they've even hired some former googlers (ex-google employees who cashed out their fully vested options..3 year vesting period).
the short's wet dream party at yhoo is over.