Microsoft Share Holders Bail Out Over Yahoo Uncertainty

**mattymcg** · Feb 10, 2008, 04:00

Microsoft lost nearly $40 billion in market cap in the eight trading days since they made their offer. That’s quite a penalty - and one Microsoft likely didn’t plan on dealing with.

Microsoft’s $80 billion (and growing) Yahoo Headache

**bluedreamer** · Feb 10, 2008, 05:49

Now wouldn't it be something if someone made a hostile takeover bid for Microsoft?

**Raffles** · Feb 10, 2008, 06:11

Poor Microsoft, they can't do anything right. Might be a good time to buy some MS shares!

**drhowarddrfine** · Feb 10, 2008, 06:50

Poor Microsoft? That's like watching the news where a murderer is gunned down and the family cries "He was a wonderful family man!"

**Raffles** · Feb 10, 2008, 07:19

But Microsoft is like a family. Bill Gates invites his employees over to his pad for barbecues and everything!

**optic-ice** · Feb 10, 2008, 07:55

if anything Microsoft shouldve tried purchasing AOL just so AOL can be done with already.

**Raffles** · Feb 10, 2008, 09:01

You think that would make AOL any less obnoxious?

**ionix5891** · Feb 10, 2008, 11:46

they already own a large chunk of AOL

**drhowarddrfine** · Feb 10, 2008, 13:10

Originally Posted by ionix5891

they already own a large chunk of AOL

So that explains EVERYTHING!!!

**Dan Schulz** · Feb 10, 2008, 14:17

Funny, you guys. Real funny.

**chaturmai** · Feb 11, 2008, 04:04

Originally Posted by drhowarddrfine

Poor Microsoft? That's like watching the news where a murderer is gunned down and the family cries "He was a wonderful family man!"

drhowarddrfine - u made me laugh

cheers

chaturmai

**siteguru** · Feb 11, 2008, 07:48

Why is this thread featured? Is it because it was started by SP Staff?

**Animedude** · Feb 11, 2008, 10:33

Originally Posted by siteguru

Why is this thread featured? Is it because it was started by SP Staff?

Conspiracy...

**AndrewCarrothers** · Feb 11, 2008, 11:58

Poor Microsoft, they can't do anything right. Might be a good time to buy some MS shares!

Microsoft is going to overpay for Yahoo and more than likely destroy a lot of value.

The problem of being Microsoft is that they have too much cash. Its a nice problem to have but still a problem non the less.

They have a few options with regard to spending that cash.

- Hold Cash
- Return Earnings to shareholders through dividends
- Stock Buyback
- Reinvest into new projects
- Acquire Other Companies.

Holding just cash would obviously destroy value. They currently have a payout ratio of 23% which is generous for a tech company.

The fact that they choose to acquire Yahoo tells me they don't have enough projects that will generate a greater IRR than acquiring Yahoo. By not buying back their own stock its also signaling that management thinks MSFT is overvalued.

Basically MSFT is saying our best use of cash right now is acquiring Yahoo vs the opportunity cost of returning it to shareholders, buying back stock or investing in new projects.

**drhowarddrfine** · Feb 11, 2008, 12:38

I'm wondering if this is the weight that will bring both companies down to the bottom.

**Patrick** · Feb 11, 2008, 16:22

I'm a Microsoft shareholder. I'm not bailing out. Actually, I plan to be a shareholder for a very long time. I'm a shareholder in Yahoo!, too, actually.

**drhowarddrfine** · Feb 11, 2008, 19:14

Never hold any stock for long term without reason. There are far, far better stocks to be holding right now than Microsoft or Yahoo.

**Wang** · Feb 11, 2008, 23:14

Originally Posted by Raffles

Poor Microsoft, they can't do anything right. Might be a good time to buy some MS shares!

Yes.. this is the right time.....
option.... "sale" - short period
share.... "buy" - long period

**JohnST** · Feb 12, 2008, 05:33

The takeover will give Microsoft a stronger online presence with access to a wide community of members who use Yahoo services.

But that is bulking up on users, not gaining any competitive advantage in search marketing. Yahoo has never cracked the code on google's superior search algorithm and Microsoft merger will not give them the breakthrough in this field either.

**samanime** · Feb 12, 2008, 06:18

A little over -$4 per share. That is quite a substantial hit. It'll be interesting to see how this plays out.

**peach** · Feb 13, 2008, 15:42

Originally Posted by drhowarddrfine

Poor Microsoft? That's like watching the news where a murderer is gunned down and the family cries "He was a wonderful family man!"

Microsoft is the same as google and yahoo etc. except that Google know really well how to say one thing and do another, without making it too obvious.

**Jake Arkinstall** · Feb 13, 2008, 16:25

The main difference is that Google listens.

Microsoft have only just started to recognise our needs for IE to be standards based.

If google made a browser, there would be daily updates, major versions coming out twice yearly and having features that would astonish.

**Dan Schulz** · Feb 13, 2008, 16:35

Yeah, and they'd call it Firefox.

**drhowarddrfine** · Feb 13, 2008, 20:47

Originally Posted by peach

Microsoft is the same as google and yahoo etc. except that Google know really well how to say one thing and do another, without making it too obvious.

How so? Show your work to prove your statement.