On Tuesday, Yahoo! Inc. (NASDAQ:YHOO) reported its first-quarter results, revealing flat revenue and profit growth. But, despite the numbers, investors are more interested in YHOO’s stake in Alibaba. Yahoo owns 24% of Alibaba, the major online commerce provider in China, who plans to go public in the next few weeks. Investing in Yahoo has historically been the only way for investors to get a piece of Alibaba, which has certainly added to Yahoo’s value. And now, on the eve of Alibaba’s IPO, some analysts are recommending BUY Yahoo, while other analysts are advising HOLD Yahoo. To see all recommendations about Yahoo, download TipRanks.
Macquarie analyst Ben Schachter, upgraded his rating from HOLD to BUY Yahoo! Inc. (NASDAQ:YHOO), and raised his price target from $37.50 to $40.00. Ben argued that “investors should buy the stock ahead of the expected upcoming Alibaba IPO.” Ben, “does not anticipate improvement in the core business,” but Yahoo’s Asia assets, which are worth $28.76/share, and Alibaba’s estimated valuation of $160-$180 billion, has led Ben to recommend BUY Yahoo. Ben is ranked number 41 out of 2993 analysts, with an +8.3% average return over S&P 500 (INDEXSP:.INX) and a 68% success rate of recommendations.
However, JMP Securities analyst Ronald Josey decided to maintain his HOLD Yahoo! Inc. (NASDAQ:YHOO) rating. Ronald argued, “we believe it remains early in Yahoos!’s turnaround across its core business and we are projecting relatively flattish overall revenue growth.” Ronald added, “While the risk/reward from a valuation perspective appears favorable, we remain on the sidelines until we see improvements in Yahoo!’s core operations.” Unlike Ben, Ronald does not think now is the time to BUY YHOO and has chosen to take a step back from the popular stock. Ronald is ranked 1251 out of 2993 analysts, with a +0.5% average return over S&P 500 (INDEXSP:.INX) and a 50% success rate of recommendations.
Carlson Capital's Black Diamond Arbitrage Partners fund added 1.3% net fees in the first quarter of 2021, according to a copy of the firm's March 2021 investor update, which ValueWalk has been able to review. Q1 2021 hedge fund letters, conferences and more At the end of the quarter, merger arbitrage investments represented 89% of Read More
Once Alibaba initiates its IPO, analysts might be adjusting their recommendations, but which analyst’s advice will you follow now? To learn more about these analyst’s past recommendations, be sure to download TipRanks, and start making informed financial decisions, with advice you can trust.