I've heard it said that stock price is the market's best estimate of the NPV of future cash flows. If that's true, does that mean that the market expects some of Yahoo's cash to disappear? I can imagine ways that it could: lawsuits, golden parachutes, maybe even stupid acquisitions...
In general, though, the market is not as rational as it's credited with being. Perfect information never exists, and emotion can distort prices; think of Black Tuesday, or all stock-market bubbles, or how MLPs are falling right now because of problems with Kinder Morgan (which isn't even an MLP in the first place).
In general, though, the market is not as rational as it's credited with being. Perfect information never exists, and emotion can distort prices; think of Black Tuesday, or all stock-market bubbles, or how MLPs are falling right now because of problems with Kinder Morgan (which isn't even an MLP in the first place).