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Technology Stocks : Altaba Inc. (formerly Yahoo) -- Ignore unavailable to you. Want to Upgrade?

To: Bill Harmond who wrote (3950)	12/9/1997 1:57:00 PM
From: Bill Wexler	Respond to of 27307

Gee William...switch to decaf! <<There was a time not long ago you were raising red flags that Yahoo had passed $1 billion market cap. Then $2 billion. Now $3 billion>> Correct. I still maintain that Yahoo is grossly overvalued at even 1 billion. <<Early arguments were that knowledgeable insiders were dumping.>> They were. <<Then it was never-proven claims of declining ad rates.>> Call a sales representative at Yahoo or four11. <<Then it was a supposed slowdown of Internet advertising spending.>> The largest interenet advertiser - AOL - reprted a significant decline in ad revenue last quarter. <<All along you short the stock heroically as the price continues to move against you>> Not "heroic"...simply an investment like any other. Yahoo is trading at absurd valuations even compared to the most optimistic earnings projections 2 years forward. <<Today you buy out-of-the-money puts with 10 days' life.>> I'm allowed to gamble for fun!. Just because I take a flier on options every now and then doesn't mean I gamble with my entire portfolio. <<All you can say lately is that they will. No insight, no corroboration, nothing but Chicken-Little predictions based on the fact that Yahoo commands a big valuation.>> Netscape (which you called "the fastest growing software company in history") once commanded a big valuation. It now trades at a fraction of that valuation. I also pointed out a lot of good companies with fast-growing businesses that were once momentum stocks and are now languishing. <<Do some homework. Talk to the company. Talk to advertisers. Take the time to understand the scope of Yahoo's business>> Check, check, check, check. BTW, the internet is a big place...my guess is that if internet advertising continues to grow - it will fill all the corners, but it won't be concentrated in the search engines. <<Maybe your "appropriate" valuation model doesn't square here, but it's a fact that the 25 best-performing stocks from 1991-1996 sold at a mean 100x forward earnings estimates during those five years, yet on-average increased in value by 1,600% during that period. As long as interest rates stay calm, it can happen again>> It may. You may also want to check what happens to high fliers with four-digit P/Es if the market should suddenly hiccup. <<Yahoo's stock will move all over the map, but over the long run it is going much higher from here.>> The long run can be very long for a new investor who buys in at these prices if the company's growth rate doesn't turn out to be what its cracked up to be. BTW, how can you be so sure that it's going much higher from here? If you do have a crystal ball, why aren't you using 100% of your life savings and mortgaging your home to buy more Yahoo at these bargain prices?