>>Yahoo is valued at nearly $1,100 per user...<<
WH - I'm not exactly sure how you're defining "user" , as there are no hard and fast numbers on how many separate individuals are accessing the site - at least that I know of - only data on "hits" that is then somehow converted to an estimated number of people , based on your choice of assumptions.
In any event , the current market price of Yahoo is based on mania, dreams , and hype , and not on a realistic analysis of what a website will actually yield in dollars of profit.
In today's trading environment , we have a feeding frenzy for certain issues , based on the promise of bigger things tomorrow. The small revenues that Yahoo and a few others are booking is being blown out of proportion into wild valuations. And when you consider that a lot of the revenue for say, Yahoo , is coming from money-losing entities like , say , Amazon and others , what do you have , on a net basis (no pun intended) ? Amazon's losses become part of Yahoo's revenues , and after Yahoo's costs are deducted , yield a small profit for Yahoo. The viability of this business model , long term , is highly questionable. Yet , the market turns a blind eye toward the negatives, and keeps plowing money into the concept. Amazing. |
