Yahoo! Gone in 12 Months?

My friend Paul Kedrosky has some choice quotes in today’s New York Times on the Yahoo management shake-up:

"Some analysts maintain that the shake-up may be only a prelude to a
more substantial corporate overhaul, which could include a merger or a
sale.

This had to happen or things would have gotten nasty in a hurry,
with people taking positions and pushing for change,
" said Paul
Kedrosky, executive director of the William J. von Liebig Center for
Entrepreneurism and Technology Advancement at the University of California, San Diego. "I’m not convinced it’s enough, but it had to happen."

You can always tell when an interviewee is media savvy by how they help the reporter set up the story: By giving them a great intro, or a good data point for the middle, or a good ending. Paul did the set up with the quote above, and clinched the ending with the following line:

Mr. Kedrosky added, "My bet: Yahoo won’t be an independent company in 12 months."

Assuming Paul is correct about this — a big "if" — AND assuming the Yahoo takeout is at a premium — a big "and" — then speculators can gamble on both of those issues via Yahoo Leaps:

The January 2009s are trading:

$30 . . . .  $4.2450
$32.50
. .  $3.2340
$35
. . . .  $2.3250

The January 2010s are trading:

$30 . . . .  $5.65
$35
. . . .  $3.50

Interesting concept for gamblers . . .

>


Source:
Yahoo’s Chief Resigns, and a Founder Takes Over
MIGUEL HELFT
NYT, June 19, 2007
http://www.nytimes.com/2007/06/19/technology/19yahoo.html

Category: Corporate Management, Finance, Financial Press, M&A

Most Over/UnderValued U.S. Housing Markets

Yesterday, we learned that the NAHB Housing Market Index, a gauge of home-builder confidence, declined to its lowest reading since the 1991 recession:

Hmi_index

Source: NAHB, Wells Fargo

>
Given the high inventory still around, its no surprise that all three components of index dropped: Single-family Home Sales fell to 29 (from 31); Traffic of Prospective Buyers droped to 21 from 22; Expected Sales for the next Six Months declined to 39 from 41.

The last time the HMI was this low was in the throes of the 1990-91 recession.

Rather than spend much time on this well-covered report, I want to draw your attention to a little followed report on Home Valuation. I stumbled across this extremely informative analysis, filled with great
info-porn maps (below) from Global Insight and National City
Corporation.

It looks at the regions of the country which have had the greatest home price appreciation and, by their measures, are the most overvalued.

First the good news: less homes are overvalued today than in 2005, when the study found 45% of all homes 23% of homes were overvalued by 45%.

Today, 14% of homes for sale are still overvalued — but by only 25%:

Overvalued

The following shows where the overvalued/undervalued homes are located:

Housing_over_under_valuation

That decrease in overvaluation comes as no surprise: The huge overhang of inventory = price decreases (see  below).

Thus, many of the over-valued regions are becoming a little less overvalued.

But, depsite the hopes of the bottom-callers, there is still a ways to go.

Source:

Full Study: House Prices in America – Q1 2007
A Global Insight / National City Corporation, June 2007
http://www.globalinsight.com/Highlight/HighlightDetail2350.htm

2006 Q1 PDF: http://www.globalinsight.com/gcpath/1Q2006report.pdf

>

additional graphs, and a summary of the report, after the jump

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