Blog Post

I put up a poll on this blog yesterday and a number of other blogs picked it up or linked to it. The net result was about 1,800 responses as of 6am eastern this morning. You can track the responses (and the number of them) at this poll result page.

The wisdom of the crowd is the closing price today will be $22. I took the percent of vote at each price level and then multiplied them out to get that expected value. Here's the distribution of votes:

The look of this chart tells me that I should have let people vote for some lower prices and that $16 vote was chosen by a number of people who would have voted for lower prices. That would have brought down the expected price, but not by much.

So if my poll is correct, YHOO will be down almost 25% today and I suspect the biggest drop will be in the morning. That's $8bn of market cap lost.

As most of you know, I think Yahoo! made the right choice by walking away from Microsoft's bid. I think it was a wakeup call and they can and will deal with much of what ails them.

Yahoo! had about $2bn of EBITDA in 2007 before you add stock based comp charges. At $32bn ($22/share), Yahoo! will trade at 16x EBITDA and that's not including the impact of their cash, their Yahoo! Japan stake, and their Alibaba stake which together add up to $14bn of value or $10/share. If you back that out, Yahoo!'s a bargain at $22/share.

So if it gets there today, I'll be buying some. I still think it ends the day at $26/share, which was my vote that kicked off the poll.