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Doesn't YHOO Look Like a Great Buy Now?
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Clinically Insane
Join Date: Oct 2000
Location: Los Angeles
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Offline
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At this level, doesn't Yahoo (YHOO) look like a great buy? Revenue up 34%, net income up by 84%. Of course, they missed earnings by a penny a share, which was enough to take the stock down nearly 8 points. I think that's a bit too much of a correction. Yahoo trades 34 times next year's earnings, while Google trades at 47 times next year's earnings. GOOG has much higher growth, but I think YHOO still looks like a bargain here. In addition, YHOO has been paralleling the movement of GOOG - when GOOG went to 400 YHOO rose to 40. I think that as long as GOOG does not disappoint with its Q4 on the 31st, YHOO will regain momentum.
On the other hand, GOOG is down 28 points over fears of the federal government. Perhaps I should just pay up and get into GOOG instead while we have this discount opportunity.
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"The natural progress of things is for liberty to yield and government to gain ground." TJ
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Senior User
Join Date: Jul 2002
Location: Arizona Wasteland
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One reason I won't buy YHOO is that it's short % is too high. I have a theory that short traders do better research then regular traders, and then the short % gets over 6% it's a warning sign.
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Professional Poster
Join Date: Sep 2005
Location: Rochester, NY
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Yahoo looks like a better value than Google right now, but I think I like Google's management a bit more. They don't seem to want to get caught up in a lot of the short-term hype that most public companies are caught up in. If you're looking at the long-term, Google is probably going to be more relevant than Yahoo. Plus, about 1/3 of Google stock is still held by insiders, vs. 10% of Yahoo.
Heck, I'm tempted to buy just one share of Google, just to see what happens to it. From everything I've read, Google will not split, because its management subscribes to the Warren Buffett school. Then again, I've apent a lot less time following stocks after my daughter was born, and have less money to invest as well. Maybe I'll wait until I can look into Google's and Yahoo's financials in more depth....
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Clinically Insane
Join Date: Jun 2001
Location: planning a comeback !
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I don't like to buy companies in whose story I don't believe. What's the great story about Yahoo ?
-t
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Clinically Insane
Join Date: Oct 2000
Location: Los Angeles
Status:
Offline
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Originally Posted by Ganesha
One reason I won't buy YHOO is that it's short % is too high. I have a theory that short traders do better research then regular traders, and then the short % gets over 6% it's a warning sign.
Good observation - I noted the short level, and I realize it could be a drag. But after this correction I think the shorts are going to get squeezed when Google shows strength and YHOO is pulled inexorably back up.
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"The natural progress of things is for liberty to yield and government to gain ground." TJ
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