Share “Investors grab up Yahoo stock”

Investors grab up Yahoo stock

By MICHAEL LIEDTKE, Associated Press Published: March 18, 2014
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Yahoo is getting another lift from its stake in China’s Alibaba Group, a thriving Internet company that has helped mask Yahoo’s own financial funk.

Investors latched on to Yahoo Monday in anticipation of a huge windfall from Alibaba’s initial public offering of stock later this year. Alibaba triggered the latest wave of excitement about its forthcoming IPO with a Sunday announcement of its intention to list its stock on a U.S. exchange instead of in Hong Kong. The precise timing of the IPO is still unclear, although the documents for the filing are expected to be filed within the next six months.

Alibaba’s IPO is anticipated to produce Yahoo’s second multibillion dollar windfall in two years. The money could be used to pay stockholders a one-time dividend, buy back more stock or finance an acquisition of another Internet service that could help Yahoo bring in more revenue after years of contraction.

Yahoo’s stock gained $1.51, or 4 percent, to close Monday at $39.11. The shares have nearly doubled in the past year, primarily because Yahoo’s 24 percent stake in Alibaba has been the only way for most investors to buy a slice of a company that is likened to China’s version of eBay and Amazon.com. Yahoo now boasts a market value $39 billion — most of which analysts estimate is tied to Alibaba’s success.

Even as Yahoo’s stock surges, the Sunnyvale, Calif., company’s long-running struggle to revive its revenue growth continues as online advertisers steadily shift more of their spending to Internet search leader Google Inc. and social networking leader Facebook Inc.

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