Why keep holding the Ersatz if you can get the real thing? Before Alibaba went public in September, one way to get exposure to the Chinese internet giant was to hold shares in Yahoo, a struggling web portal, which has a large stake in Alibaba. Now investors can buy Alibaba directly, Yahoo’s market capitalisation has slipped to $40 billion. Subtracting the after-tax value of selling the Alibaba stake and another one, in Yahoo Japan (a separate firm), and allowing for Yahoo’s cash and debt, that means investors value its core business at little more than $4 billion. Things cannot be that bad: so if Yahoo moved to break itself up, as some suggest, its shares would look cheap.
Link to article: www.economist.com/news/business/21621812-investors-put-low-value-yahoos-core-businessfor-now-what-it-really-worth?fsrc=rss|bus