Tuesday, January 29, 2008

Yahoo! YHOO is toasted from here. WEB 2.0 Bubble is bursting right now.

Free cash flow in 2007 was 1337 mil USD, they are projecting now only 925 (mid 850-1000) for 2008, it is 31% drop! Now Yahoo is valued at 20.7 multiple to FCF in 2007. Going into recession ( I think as you remember that USA is in recession last three Qs) with this multiple and crashing FCF will make stock valuation even at 14.35USD as very rich.

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