Altaba Inc. (formerly Yahoo) Message Board

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Technology Stocks : Altaba Inc. (formerly Yahoo)

AABA 19.63

0.0%

Nov 6 4:00 PM EST

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To: Bill Harmond who wrote (3004)	11/20/1997 2:35:00 AM
From: Bill Wexler	Read Replies (1) of 27307

<<Are you saying Yahoo is worth $5 a share?>> $5 sounds good (and I'm quite serious when I say that). Then it would only be trading at a "reasonable" 5 x sales. I don't beleive for a second that they will do $.38 a share next year. Net-net Yahoo is a consistent money loser. <<If one is willing to buy Yahoo at $50, and hold for 21 years through good and bad trading, there isn't a better investment I can imagine.>> Yahoo is a search engine that sells banner ads. This business may change dramatically over the next few years...perhaps (dare we say it) for the worse. If you can extrapolate its growth 20 years into the future, then you are a much more prescient investor than I am. My guess is that if we weren't in the midst of a speculative stock mania and momentum "investing" fad, you'd be singing a different tune. The present valuation of Yahoo compared to its gross revenues and earnings growth, makes it an incredibly risky proposition. History has shown time and time again that these hype rockets usually end up badly if valuations reach extremes. Even a slight disappointment can kill the stock.. We haver already seen evidence that Yahoo's sequential revenue gerowth is slowing...and let's not forget my favorite point...in the last year and a half Yahoo has had exactly $200,000 in operating earnings. Believe it or not, earnings DO matter....even for Yahoo. Buying at $50 builds in a lot of pie-in-the-sky growth expectations. But then again. What would I know? I don't "get it".

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