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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: Jeff Mills who wrote (12260)	7/9/1998 2:44:00 AM
From: craig crawford	Read Replies (2) of 27307

>> This YHOO situation reminds me HEAVILY of DELL 1996 << I don't see that. >> DELL closed today at $96 1/2, which multiplied by 8 gives $772. $772!! DELLs cap today is near $50 BILLION--the small share base, multiple splits, and shorts have made longs RICH. (enter YHOO and its 54.6 MM shares--sound familiar?) << Ahh, but look at what DELL earns. Over $1 billion in earnings in the last 12 months. DELL has 60 times the sales of YHOO. So if you think YHOO is going to $60 billion like DELL has in the last 2 years, A) YHOO better start planning on earning $1 billion dollars B) YHOO better command an even more stratospherical multiple Do you think YHOO will be earning even 1/2 DELL's $1 billion ($500 million) in two years? With $500 million in earnings and no increases in shares outstanding, YHOO would sport a PE of 120. $500 million in revenues is easily doable by YHOO in 2 years but I don't think they can earn $500 million. >> Softbank just dished out $183 per share. People had the chance to buy at $175 today. $220+ open Thursday AM. << Really doesn't mean alot. There are numerous examples in history where companies have overpaid when purchasing a stake in another company. Softbank paying $183 doesn't mean YHOO is fairly priced there. It may prove to be a short-term floor for a while but fundamentals can turn for the worse and $183 could be meaningless if/when they do.

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