With Yahoo’s shares trading just over $14, investors are telling the world that its core business is worthless, says Aaron Kessler of ThinkEquity.Kessler did a sum-of-the-parts analysis of Yahoo, and estimated that Yahoo’s assets are worth $15.29 per share in total. If you discount 30% to factor in tax implications from selling, Yahoo’s assets are worth $9.50 per share (not counting cash).
In other words, if you stripped out the strategic investments and just looked at Yahoo’s core business, it’s only worth $4 or less, says Wall Street.
Here’s the breakdown via Eric Savitz at Barron’s:
- Yahoo! Japan: The company owns a 34.9% stake; on an undiscounted basis, he calculates, the stake is worth $4.88 a share.
- Alibaba.com: Yahoo has a 29% stake, worth $2.10 a share on an undiscounted basis.
- Alibaba Group: Yahoo has a 40% stake, which he estimates is worth $5.61 a share.
- The company has $2.70 a share in cash.