Ealier this week, I sold the majority of my holdings in YHOO. As I mentioned, yes, I sold some shares to hedge myself from the emotional Jerry Yang express… but I also did it because of my obligations to our company. It was prudent to do so, basically, to ensure that I could fund operations if need be (repeat after me: A/R = bad!)
Anyway, you know the saying: bulls make money, bears make money, hogs get slaughtered. So, I got out at around $29. Two short days later, it’s below $27. Over the number of shares I unloaded: that is rent, payroll, equipment for a few months right there.
Today we hear MSFT is meeting YHOO for informal talks. In part due to the fall in MSFT’s stock price, the $44.6B offer is in fact a $41B offer… and YHOO is now worth $36B. Initially I thought the deal would close at $50B but the market has changed and YHOO’s Q1 won’t be anything to write home about…
So this begs the question:
- Will the deal happen?
- If yes, when?
- If so, at what price?
- More importantly, is this an entry point back into the stock?
I do not know: but my guess says yes, who knows, $31-ish and not sure, depends on how much cash you have lying around.
Frankly, I see some better opportunities in this market.
Why? The $31/share was benchmarked to Google’s $747 altitude, I think… and not the wobbly $437 Google… but rest assured, if I do make a purchase, I’ll post it here.
If this was a matter of two companies acting pragmatically, it would be different. But when people let their emotions drive their decisions, it’s bad news for everyone.
As a widely held security, hopefully Yang won’t damage too many people nest egg.
Disclaimer: Long - albeit lighter - on YHOO.
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