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Yahoo shares hit five-year low

04 сентября 2008

Shares of Yahoo Inc. hit their lowest level in five years Tuesday, dropping below the $19 mark for the first time since the aborted takeover bid from Microsoft Corp

By Tuesday's closing bell, Yahoo shares had dropped 3.3% to close at $18.75. The drop was more pronounced than other tech stocks, which slipped in late-day trading, tracking a turnaround in the broader market. The Nasdaq closed the day down nearly 0.8% to 2349.

Yahoo was inactive in Wednesday's premarket trading.

Yahoo has shed a large portion of its market value since early this year, when the company was a takeover target in a $47 billion offer from Microsoft.

The software titan offered to buy Yahoo for $31 a share in a half-cash, half-stock transaction on Feb. 1, when Yahoo shares were trading just above the $19 mark. Yahoo rejected the offer as undervaluing its business, and the two companies spent the next few months battling over the proposed deal, with Yahoo reportedly holding out for a price closer to $40 per share.

In May, Microsoft upped its offer to $33, and then pulled the offer after failing to come to agreement with Yahoo.

Yahoo was heavily criticized by shareholders for failing to close the deal. The company was targeted in a proxy campaign by billionaire activist Carl Icahn, who eventually won three seats on the board under a settlement with the company. As part of a move to improve its market value, Yahoo struck a deal with search rival Google to outsource some of its search activity in exchange for a portion of ad revenue.

On Tuesday, Google announced that it has developed its own Web browser called Chrome, which will challenge Microsoft's Internet Explorer, the largest browser on the market.

Wall Street analysts have a mixed view on Yahoo's current prospects. Most carry neutral ratings on the shares despite the company's relatively low valuation. Price targets on the stock range from $14 to $33, with the median at $24, according to FactSet Research.

Источник: Total Telecom

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