>>What is your criteria for starting to short Yahoo?
I guess if it spiked rapidly to $165-170 in very short order from here...that would put it at 2x it's 50-day average. The tops for Netscape and Iomega were at 2x their 50-day averages. Assuming nothing fundamental changed, I personally would sell or hedge at least half my position then, and I bet it would be a terrific near-term short trade.
If Yahoo keeps doing what it has been doing for the past 16 months...advancing, consolidating, correcting some, advancing more, etc, I wouldn't short it. I wouldn't short it if it corrects from here, either.
The fundamentals are very strong and have gotten stronger. If Yahoo beats estimates like I earlier supposed it could in 1999, and interest rates stay very friendly, Yahoo's growth rate could conceivably support its current PE of 270 x current-year earnings...basically its EPS growth rate. That implies a conceivably-possible rosy-scenario wild-hare outside 1999 price target (enough conditions?) in the high 300's per share...a triple...basically a current-trend advance similar to AOL in the early years.
I'm not predicting this will happen. Alot can go wrong. If the Fed raises rates this Fall, forget everything. I think it could happen under ideal market circumstances like we've had, and if Yahoo maintains it's growth and lead, and commerce revenues ramp like they have been. Something for a potential short to ponder.
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