5. Yahoo!'s Punctuation Problem
Are we alone or does anybody else think it's long past time to yank the exclamation point from Yahoo! (YHOO) and replace it with a question mark? Because it's a mystery to us how these guys continue to operate the way they do.
Alibaba Group, the Chinese internet giant which is 43% owned by Yahoo!, will potentially reap up to $6 billion in a spin-off of its Alipay e-payment division under a deal announced last Friday. Alibaba will pocket no less than $2 billion in proceeds if Alipay goes public or cashes out in some other type of "liquidity event." Shares of Yahoo! initially popped on the long-awaited transaction, but finished the day 3% lower as investors failed to figure out what's in it for them. And as we are constantly reminded, the market hates uncertainty.
As for us, we just hate stupidity. And from our vantage point this whole puzzling transaction seems tilted in that direction. Just to step back a bit. Yahoo! claimed in May that Alibaba's CEO Jack Ma had essentially stolen Alipay from under its nose in a so-called corporate restructuring. Alibaba disputed Yahoo!'s version, saying Jerry Yang, the former Yahoo! CEO and member of both boards, was indeed aware of the transaction, which blindsided current Yahoo! CEO Carol Bartz. Meanwhile, as a result of all this bewildering behavior, hedge fund honcho David Einhorn bailed out of his recently acquired chunk of Yahoo! stock stating: "This wasn't what we signed up for." Einhorn, like many others, originally bought into the stock on the belief that Yahoo! could capitalize on its Asian assets. And while last week's announcement explains how Alibaba can make good on Alipay, it unfortunately doesn't offer any real insight as to how Yahoo! can turn its Alibaba stake into cold hard cash. So mark our words Carol Bartz. Until you start answering some of these fairly simple questions, you better be willing to accept some nasty exclamations from your shareholders. Get the point?
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV