Boston, MA 09/03/2014 (wallstreetpr) – It seems that Yahoo! Inc. (NASDAQ:YHOO)’s shareholders as well as Chief Executive Officer, have finally come out of the long spell of doom after being kissed by the profitability generated by company’s stake in Alibaba. After having waited for several years, Marissa Mayer, the CEO of Yahoo and its shareholders, will be able to mint money through its venture in Alibaba, the e-commerce magnate in China.
Alibaba Most Likely to Go for IPO with Symbol BABA; Yahoo Dancing with Joy
Yahoo! Inc. (NASDAQ:YHOO) shares have started jumping with joy already, anticipating a scheduled IPO of Alibaba with ticker symbol BABA in The States. The stock of Yahoo climbed around 8% in the previous month, while its rival, Google Inc (NASDAQ:GOOGL) jumped a little below 1%. Yesterday morning, Yahoo was rising high approximately 2%.
Considering that Alibaba would be doing quite well and that the analysts are expecting high from it, it should not come out as a shock to anyone that the investors of Yahoo are already feeling butterflies bouncing in their stomach.
In fact, some of the analysts are also expecting that value of Alibaba would be nothing less than $200 billion, after it starts trading by the end of September 2014. On these speculations, it is expected that Yahoo’s value would be totaled somewhere around $45 billion through its stake in Chinese Alibaba.
Is Yahoo Only Valuable Because Of Alibaba?
It is quite interesting to note here that even though Yahoo! Inc. (NASDAQ:YHOO)’s shares saw a spike in the previous month, but the overall stock for 2014 has still not surged and is down 3%. So, basically Yahoo has already missed the rally of 2014. Also, it is worth considering that the market value for Yahoo at present is merely $39 billion; which is even less than its Alibaba stake. So, does that mean, Yahoo is valuable only because of Alibaba right now?
As of now, Yahoo! Inc. (NASDAQ:YHOO) has plans of selling approximately 140 million shares through this offering, which is just a few percentage points over 25% of total shares of Alibaba. This means that, Yahoo might finish up with approximately $12 billion (before tax). According to the CEO, half of the proceeds shall be shared with the investors, while for the rest of cash; Mayer will have to prove that the revamping plan of company is actually going to materialize.