Like some people on this board, I have difficulty supporting YHOO's current market capitalization. In trying to decide when to buy and sell, I found Bill Fleckenstein's reason for not shorting Internet stocks, as noted in TheStreet, of some value. He agrees that the valuations are high, but however there is no reason for people to dump them. He says: "If you can sell at one stupid price, you can sell at any stupid price." He's right. At the current multiples, what stops YHOO from trading at $125, $150, or how about $175? As someone implied on this board, what stops a person from buying a $1000 tulip if that person expects to eventually get $1,100 for it? With momentum carrying it higher, what can kink YHOO's armor and force the price down or keep it stable enough to let the PE catch up somewhat? What technology/firms lurk in the background, ready to nibble at its lead?
All my best,
Osman. |
