3. – Overview
Founded in 1994 by David Filo and Jerry Wang from
the campus of Stanford University
Workforce of 11,700 people; offices in more than 30
countries, regions & territories
Focusing on search, content & communication
Main competition is comprised of large, multi-
national web service and search engine companies
such as Google, AOL and MSN
Revenues for Yahoo! Inc. are mainly from placing
advertisements, especially for large brands such as
Walmart, General Motors and Bank of America.
8. Does it make sense?
Comparing to the market
2008.11.21 2009.01.23 2010.08.27 2011.08.05 2012.08.31
(lowest) $ 9.39 $ 11.32 $ 13.43 $ 11.74 $ 14.65
Market Cap. $ 13,066,748,400 $ 15,916,769,000 $ 17,577,667,480 $ 14,293,226,940 $ 16,338,163,450
NASDAQ real-time data (Sep 3rd
Price per share 27.60$ !
Market Cap. 33,12 B $ !!!
Market expectations (comparing with our calculations)
1. Growth 5.75% !!!, @WACC 7.84%; or
2. WACC 4.4% !!!, @growth 2%
9. Conclusions & recommendations
Current market expectation are overheated with
emotions and too optimistic or even unrealistic.
We recommend to BID taking 2% growth (max)
and more conservative WAAC 10% (min)
The first BID then could be ~15 B$
Apple (they have huge amount of cash) might buy
Yahoo! Inc. Synergies with “Apple” are not
33 B$ is not realistic price. All premium will go to
shareholder of Yahoo!
The deal could be closed at 18-20B $ (max).