Jamie Dlugosch
Recent Posts
Monthly Archive
RSS 2.0Atom
To add an specific blogger’s feed, simply go to their blog and click on their individual RSS link.
Stealing Yahoo Confirmed?
Rating: 2.00 (1 votes)
Vote: 
InvestorPlace Blogs is powered by Marketocracy. Marketocracy has authorized Investor Place Blogs as an official registrar for voting through Marketocracy's Investment Research Rating service. Registered members of InvestorPlace Blogs are linked with a Marketocracy account to establish voting power based on their performance of trading and posting on stocks.
On Monday we can expect a rally in Yahoo and a drop in Microsoft. The reason: Yahoo is set to reject Microsoft's $31 per share offer as being too low. According to Reuter's, inside sources are claiming that Microsoft's offer is an attempt to steal the company. Well that's a good one not heard before, right? I think the title to my first article on the topic was, "Microsoft Steals Yahoo?" Anyway, as a fan of Yahoo before the offer the $31 price, while representing a big premium, did not represent the true intangible value of the company. I was honest by saying that I was upset at the offer. It now appears that the board agrees with me. They will not capitulate without getting full price for the company and with the levers they can pull, including entertaining overtures from Google, I suspect they will get a much higher price than the $31 offer. That's the good news. The bad news is that I will have to be a bit upset on the other side as Microsoft's share price might suffer in the short term. In my Bull/Bear article InvestorPlaceBlogs, our bull contributor suggested buying Microsoft after all of this shakes out. That advice will look pretty good on Monday. The action by Yahoo's board will surely put pressure on Microsoft to offer a higher price and the reaction by the market can be expected to be negative for Microsoft. Will it be a 3, 5, 10 percent haircut? Only time will tell, but 5% or a bit more on the down side seems reasonable. If you own Microsoft there is not much to do but hold for the long term. If you are waiting patiently for the final chapter in the story, you may be able to buy Microsoft at a lower price. Unless Yahoo's board overplayed its hand, Yahoo looks almost certain to rise from here. That will be an appreciated outcome for those Strategy Lab Open participants that bought Yahoo even after the announced deal at $31. Cleary this audience knows what it is doing. Congrats and keep up the great work. Jamie Dlugosch TrackBackTrackBack URL for this entry: | ||
