Goldman Sachs: Sell Yahoo

Goldman Sachs (NYSE:GS) recommenced its coverage of Yahoo (NASDAQ:YHOO) with a Sell rating and a suggested price target of $14, citing deteriorating fortunes of its core business, even though it sees value on the company’s balance sheet. “While there is significant value on Yahoo’s balance sheet, we don’t expect management will be able to unlock it to shareholders’ benefit before Yahoo’s core business deteriorates further,” Goldman said in its analysis.

The internet has seen a 5% rise, year-on-year, in global minutes/user, whereas, in contrast, Yahoo has declined 5%, with usage down in its key segments such as search, mail, and entertainment. According to Goldman, search is a vulnerable area for Yahoo, even considering Microsoft’s one-year extension of its minimum revenue per search guarantee

The First Yahoo Bids Are Coming In, And They Look Pretty Low

by Matt Rosoff

Yahoo billboard SF

At least two private equity groups placed bids on Yahoo today, and both bids valued the company at more than $20 billion.

A consortium led by Silver Lake bid $16.60 per share for a minority stake, according to Bloomberg. That would value Yahoo around $20.6 billion, or about 6% higher than the company’s share price at market close today.

It’s also on the very low end of the bidding prices that have been floated in the pressover the last couple months.

Microsoft and Andreessen-Horowitz are also part of the Silver Lake group, the report says, although sources told us that Microsoft is still keeping its options open. Microsoft’s main interest in the deal is preserving its search arrangement with Yahoo.

TPG Capital placed a higher bid, but the exact numbers weren’t reported.

Jack Ma’s Alibaba Group is still interested in buying Yahoo to regain control of Yahoo’s 40% stake. It is monitoring the bidding.

Other firms reportedly considering a bid are KKR & Partners, Blackstone, and Thomas H Lee Partners.