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Yahoo or Yikes?

Yahoo hasn't done particularly well since Microsoft's unsuccessful hostile takeover this past February. That same month, Yahoo laid off a thousand workers, but then hired back more to fill their places. Now Yahoo promises to print up to 1,500 pink slips -- this after announcing a 64 percent earnings decline to $54.3 million in the latest quarter.

Moves like this have driven Yahoo's stock down to the point where it's almost affordable. In fact, shareholders are pining for the days when Microsoft offered almost $45 billion for the company. The offer was for $33 a share. Yahoo, last time I checked, was trading for around 12 bucks. Yikes!

So does this mean Microsoft should offer $15 billion now for Yahoo? Even at that price, I think it's a bad idea, a me-too play aimed at Google but one that lacks innovation and punch. Is a $15 billion Yahoo a bargain? Financial acumen welcome at [email protected].

And you can find the LA Times story on Yahoo's woes posted at our new Web site, RedmondReport.com.

Posted by Doug Barney on October 22, 2008 at 11:52 AM


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