A couple finance stories caught my eye recently. While stockholders in general are bummed about the state of the market, there’s a couple groups that are more bummed than others. At least others can see an upside down the road (even if it’s years down the road), but Yahoo and and Circuit City owners may want to go back in time a couple of months.
Circuit City seems to be circling the drain. The Wall Street Journal (subscription req’d although you can read the lead) reports Circuit City plans to close 150 stores. They also say they hired the same bankruptcy counsel that handled Kmart. Back in May Blockbuster was looking to buy Circuit City for about $1.5 billion (that’s with a “B”). At today’s close Circuit City had a market cap of 58.84 million (that’s with an “M”). Ars Technica has more info and no subscription required. Others have reported Circuit City is a bit limited in getting credit from it’s vendors heading into the critical holiday season. In the case of the Circuit City deal I have to admit I didn’t understand the reasoning but from Circuit City’s perspective I would certainly have taken the money. Even back then the company was suffering from bad decisions (firing experienced sales people and using lower cost new hires).
Then there’s Yahoo. Earlier this year the wires were abuzz with news and rumors about Microsoft buying Yahoo. Yahoo management seemed vehemently against the concept at any price and looked for any way to fend Microsoft off. The Google deal they made is still under Justice Department review (or pre-review discussions). The most common price bandied about at that time was $33 and share. Today the market (including Microsoft) was up but Yahoo stock was down, closing at $12.86.
Yahoo seems to be flailing. A small (0.14%) Yahoo investor tried to get Microsoft to make another offer of $22 a share. Now there are rumors of more Yahoo layoffs. While people should expect change with web apps, Yahoo deleted user profiles (set them to blank) as part of some changes. Change is one thing and since people just hate change complaints are expected, user outrage will blow over unless the changes suck. But deleting data? There’s no excuse (Even if, as the first Slashdot commenter said, “And nothing of value was lost”)
Back when Microsoft made the initial overtures it appeared Jerry Yang and company were more concerned about themselves (or their egos) than shareholder value. They promised they had a plan and shareholders would do better with them than Microsoft. How the hell do these guys stay in their positions?
Years ago I owned a few Yahoo shares. That was back when I was learning that individual stock picking wasn’t for me. Glad I got out when I did. I was lucky, I underperformed the market but got out when that meant I could still be on the plus side. With the way Yahoo is today it was obvious I wasn’t any good at long term predictions either.
Can We Go Back? Please!
A couple finance stories caught my eye recently. While stockholders in general are bummed about the state of the market, there’s a couple groups that are more bummed than others. At least others can see an upside down the road (even if it’s years down the road), but Yahoo and and Circuit City owners may want to go back in time a couple of months.
Circuit City seems to be circling the drain. The Wall Street Journal (subscription req’d although you can read the lead) reports Circuit City plans to close 150 stores. They also say they hired the same bankruptcy counsel that handled Kmart. Back in May Blockbuster was looking to buy Circuit City for about $1.5 billion (that’s with a “B”). At today’s close Circuit City had a market cap of 58.84 million (that’s with an “M”). Ars Technica has more info and no subscription required. Others have reported Circuit City is a bit limited in getting credit from it’s vendors heading into the critical holiday season. In the case of the Circuit City deal I have to admit I didn’t understand the reasoning but from Circuit City’s perspective I would certainly have taken the money. Even back then the company was suffering from bad decisions (firing experienced sales people and using lower cost new hires).
Then there’s Yahoo. Earlier this year the wires were abuzz with news and rumors about Microsoft buying Yahoo. Yahoo management seemed vehemently against the concept at any price and looked for any way to fend Microsoft off. The Google deal they made is still under Justice Department review (or pre-review discussions). The most common price bandied about at that time was $33 and share. Today the market (including Microsoft) was up but Yahoo stock was down, closing at $12.86.
Yahoo seems to be flailing. A small (0.14%) Yahoo investor tried to get Microsoft to make another offer of $22 a share. Now there are rumors of more Yahoo layoffs. While people should expect change with web apps, Yahoo deleted user profiles (set them to blank) as part of some changes. Change is one thing and since people just hate change complaints are expected, user outrage will blow over unless the changes suck. But deleting data? There’s no excuse (Even if, as the first Slashdot commenter said, “And nothing of value was lost”)
Back when Microsoft made the initial overtures it appeared Jerry Yang and company were more concerned about themselves (or their egos) than shareholder value. They promised they had a plan and shareholders would do better with them than Microsoft. How the hell do these guys stay in their positions?
Years ago I owned a few Yahoo shares. That was back when I was learning that individual stock picking wasn’t for me. Glad I got out when I did. I was lucky, I underperformed the market but got out when that meant I could still be on the plus side. With the way Yahoo is today it was obvious I wasn’t any good at long term predictions either.
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