Tuesday, November 18, 2008

I still Yahoo!

I keep hearing that Yahoo! is in financial trouble. Microsoft was going to buy them and has changed its mind. A merger with Google may violate anti-trust laws and is off the table. Yahoo! CEO Jerry Yang is stepping down to his former role as Chief Yahoo as a result of all the difficulties.

What difficulties? I mean, I use google as my search engine of choice, and I admit I used to use Yahoo! for this purpose some years ago, but I still use Yahoo! for a number of other things. When I need to look for local businesses then I go to the yp.yahoo.com site. When I’m considering adding a stock to my portfolio I go to finance.yahoo.com to look at its stats, charts, and profile.

In fact, looking at that information for YHOO the company looks pretty solid. Of course, the price of the stock is up 11% as of this writing today on the news that Jerry Yang is stepping down as CEO…

My primary email address is accessed via my my.yahoo.com page. That’s also where I go to read Doonesbury every morning. And that’s where I check to see what movies have gone to the local 2nd-run theatre this week. (Maybe I’ll go see W. tonight)

Hey, I just modified my my.yahoo.com page to display what’s on in primetime on any given day to see if there’s anything I want to watch. (There’s not, incidentally.)

It remains a profitable company. It pays out decent earnings. And their product remains useful to me personally.

So what’s the matter with Yahoo!? I guess the problem is that it’s not as profitable as it used to be.

Still, just now it looks like a better investment than most stocks on the market.

Do you yahoo!?

UPDATE: Read the comments and read this if you have the time.

3 comments:

Eric Francis said...

The problem with Yahoo is the same problem that so many other profitable companies have: They're not making as much money as speculators, commentators and outsiders with no say in their operations THINK they should be making. Just watch the business pages any time earnings are being reported: Company X can come along with a 10% increase in earnings over last year, but because Wall Street pundits THINK Company X should've gone up 17%, their stock price plunges and the board is ousted and there's a hostile takeover. It's market manipulation, plain and simple.

This is one reason that a big part of me thinks that it's a bad idea to have publicly traded corporations. Just let companies be owned by the people who run them, and answerable to themselves. If I have a business and it returns 5% a year in earnings to me and I'm happy with that, whose business is it? Nobody's but mine.

HuckCrowley said...

Read this: http://www.portfolio.com/news-markets/national-news/portfolio/2008/11/11/The-End-of-Wall-Streets-Boom?print=true%22

This is one more thing I read because of Andrew Leonard's How The World Works blog over at Salon.

Towards the end of the article it talks about the man who turned Salomon Brothers from a private partnership into Wall Street’s first public corporation.

"He and the other partners not only made a quick killing; they transferred the ultimate financial risk from themselves to their shareholders."

All the big wall street firms are publicly traded now. The ultimate financial risk of the decisions these firms make, then, is not held by the firms themselves.

They used to be betting with their own money. Now they bet with other people's.

Oy.

Sadly, I hadn't read this before I recently doubled down on my stock investment strategy.

I find myself wondering if I should get involved with a private venture capital company that then invests in other privately held companies. I've been frustrated that a lot of the investment opportunities about which I'm most excited are not publicly traded. Like HumdingerWind.

Maybe the fact that they're not publicly traded means that they're insulated from market manipulation.

HuckCrowley said...

It cut off my link in my comment above. Now I have to update the original post...