

Ask HN: Does $36B of Yahoo's $41B market cap come from Alibaba? - nashequilibrium


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nicholas73
No. The market won't value Yahoo's Alibaba stake at market value because it's
an illiquid and large stake. Were Yahoo to attempt to sell it, the price would
collapse. Further, Alibaba's value is possibly inflated as well, but since
prices are set at the margins, it might take a while to find out. Thus, there
is no reason for Yahoo's stock to track Alibaba directly.

A similar phenomenon occurred when Cypress owned half of SunPower, but its
SunPower stake virtually represented its market cap. Of course, SunPower was
to crater later on...

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nashequilibrium
It's interesting because i heard the quote on bloombergwest today, which
peeked my interest.

