Tag Archives: yhoo

List Of Yahoo Suitors Gets Longer; Stock Up On Price-Target Boost

A takeout seems inevitable for troubled Web portal Yahoo ( YHOO ), which is seeing its core business continue to weaken, according to a report on Monday by Mizuho. The Japanese bank handed Yahoo a price-target boost in anticipation of an acquisition, and Yahoo stock rose. Mizuho raised its price target on Yahoo stock to 32 from 29, maintaining a neutral rating. Yahoo shares were up 3% in midday trading in the stock market today , above Mizuho’s 32 target. Still, Yahoo is down 28% over the past 12 months amid concerns about the company’s poor financial showing and its future, with some influential investors calling for Yahoo CEO Marissa Mayer to resign. Despite gains in its mobile business, Yahoo’s unique visitor count is sinking, down 7% year-over-year in January, after a 5% drop in December and a 6% fall in November, Mizuho analyst Neil Doshi said in Monday’s industry note, citing comScore data. “In fact, January 2016 was the worst monthly decline in unique visitors we have ever seen for the company,” wrote Doshi, with total time spent on Yahoo sites dropping for the first time, down 4%. “We expect Yahoo will be more vulnerable a year from now to losing users and ultimately ad dollars to larger platforms like Facebook ( FB ), Alphabet ( GOOGL )-owned Google and high-profile startups like Snapchat and Pinterest,” Doshi said. Will Yahoo Appoint Starboard Reps To Its Board? With news reports of Yahoo’s board looking to add two Starboard Value executives to its board, and Yahoo saying it will hire outside bankers, “it seems like the board (and maybe or maybe not Ms. Mayer) … (is) getting more aggressive with Yahoo and M&A,” Doshi wrote. Verizon Communications’ $4.4 billion acquisition of AOL last year “can be viewed as a floor” price for any potential Yahoo buyout, he said. Yahoo’s directors are close to offering at least two board seats to Starboard, an activist hedge fund, in order to avert a proxy fight, according to a report on Friday in the New York Post. Starboard founder Jeff Smith is looking to oust Mayer and force a sale of the company’s core Internet business. Comcast ( CMCSA ), Verizon ( VZ ) and AT&T ( T ) “remain the leading candidates to acquire Yahoo,” said Doshi, adding that those companies could offer a higher price than private equity groups and that they have huge subscriber bases across Internet and TV and operate leading mobile services. “Each of these companies could easily absorb Yahoo , and with clear synergies to their businesses,” Doshi said. Scott Rostan, founder and CEO of Training the Street, a group teaching corporate valuation and merger and acquisition skills, agrees. “AT&T, Verizon and Comcast are such large companies that this would be almost just like a little, bite-sized morsel that they’d be gobbling up,” Rostan told IBD. “The ability to do the transaction would be pretty easy for those companies. It would be more of a question of do they want (it) from a strategic standpoint.” Time ( TIME ) could be another possible strategic suitor, Rostan said. “Imagine Yahoo Sports with Sports Illustrated somehow. Imagine Yahoo News with Time. Imagine Fortune with Yahoo Finance,” he said. “There could be some very interesting combinations that come out” of such a deal. On Monday, Yahoo estimated that its restructuring effort would result in pretax charges of $64 million to $78 million, mostly in the current quarter. Of the total, $40 million to $48 million would be for severance pay and related cash expenditures, the company said in a regulatory filing on Friday. Yahoo announced on Feb. 2 that it would reduce its workforce by 15% by the end of 2016 and close offices in Dubai, Mexico City, Buenos Aires, Madrid and Milan.

Comcast, Verizon Seen As ‘Willing, Aggressive’ Yahoo Buyers

Comcast ( CMCSA ), Verizon ( VZ ) and AT&T ( T ) would make perfect buyers for sagging Yahoo ( YHOO ), says investment bank Mizuho Securities. All three companies “would be willing to bid aggressively for Yahoo in order to gain access to Yahoo’s user base and online advertising assets,” wrote Mizuho analyst Neil Doshi in a research note Thursday. “There is no shame in selling the core business to a strategic buyer. Tim Armstrong sold AOL to Verizon for $4.4 billion, an impressive outcome for most parties involved.” Yahoo’s board also “seems to be at odds” with Yahoo CEO Marissa Mayer and the two-year strategic plan that she recently proposed, Doshi said. “This rift could be exacerbated if the board gets compelling offers that Ms. Mayer is not willing to accept. We haven’t come across many investors that are thrilled about Mayer’s two-year strategic plan, so we’re not optimistic that she will have success on this front.” Almost all of Yahoo’s current value stems from its stake in China Internet powerhouse Alibaba Group ( BABA ). The company’s turnaround plan includes continued investment in what the company calls “Mavens,” an acronym for Yahoo’s mobile, video, native advertising and social businesses, where its ad revenue is growing. Mayer said the Web portal will narrow its focus to four areas — news, sports, finance and lifestyle. “A simplified Yahoo will yield better focus, execution and increase shareholder value,” she said in the company’s Q4 earnings conference call. Mayer reportedly will further outline her turnaround plan before two major hedge funds that are major Yahoo shareholders, Millennium Partners and Mason Capital, according to a report Wednesday in the New York Post. That news report comes on the heels of Mayer’s hiring of Manhattan-based Innisfree M&A to help recruit investor support, as activist investor Jeff Smith of Starboard Value pushes for Mayer to leave. Yahoo this month said it would cut 15% of its workforce, close five non-U.S. offices and look to sell non-core divisions and assets, such as patents and real estate, as part of a strategic plan to return the company to modest-though-accelerating growth in 2017 and 2018. By year-end, Yahoo said it anticipates having about 9,000 employees and fewer than 1,000 contractors, representing a workforce that is 42% smaller than it was in 2012. It expects to save $400 million a year in short-term operating expenses from these cuts. Yahoo stock, up a fraction in afternoon trading in the stock market today , near 31, has tumbled nearly 40% since the start of 2015.

List Of Yahoo Internet Business Suitors Now Includes Time Inc.

Add Time ( TIME ) to the list of companies reportedly interested in exploring a bid to acquire Yahoo ’s ( YHOO ) Internet business, joining Verizon Communications ( VZ ), AT&T ( T ) and others. Time has been studying the Yahoo bid for several weeks, reaching out to bankers to help finance the deal, according to a report from Reuters , citing a source familiar with the situation. Time is the publisher of Sports Illustrated, People, Fortune and Time magazines. A report from Bloomberg also said that Time is considering a Yahoo deal. Bloomberg said that Time could pursue a deal structure with Yahoo called a Reverse Morris Trust, a tax-free transaction in which one company merges with a spun-off subsidiary. Yahoo has reportedly rebuffed several potential buyers for its core Internet assets, including private equity firms. Verizon, which last June acquired AOL for $4.4 billion, has expressed interest in Yahoo’s core business. In addition to AT&T, other companies interested in exploring a deal for Yahoo include private-equity firms Bain Capital Partners and KKR ( KKR ). On Friday, Yahoo said that it had formed a committee of independent directors to entertain offers for its core Internet business. Also last week, Yahoo said that it will shut down seven digital magazines , following through on its layoffs and reorganization plans aimed once again at trying to rejuvenate growth. Yahoo in December abandoned plans to spin off its stake in Alibaba Group ( BABA ) and announced that it would instead look to possibly spin off its core Internet business and other assets, including its stake in Yahoo Japan, into a new company. Yahoo stock was down more than 1% in afternoon trading in the stock market today .