The last trade he blogged was his short eBay/long Amazon trade which netted him a sweet 25% gain in a month or two, while the market was falling apart.
I like to pay attention to Mark’s picks. He’s what you call a money maker.
His timing on Yahoo! couldn’t be better. Yahoo!’s stock is off 20% on the news that their new search platform, code named Panama, is going to be late by as much as six months.
Yahoo!’s market cap is down to $35bn.
It is hitting its numbers and is on plan to earn $2bn of ebitda this year.
So you can buy Yahoo! at 19 times trailing EBITDA and about 17x this calendar year's EBITDA.
That’s a pretty compelling price for one of the few firms that is riding the Internet wave instead of getting trashed by it. The current year EBITDA multiple is a bit lower than that of News Corp.
Sure they have issues in search. They are a distant second to Google and don’t monetize search nearly as well as Google (which is where Panama comes in). But according to Comscore, they are holding their share while everyone else is losing share to Google.
And when it comes to banners, which are the hot growth sector right now, Yahoo! is king.
So I am with Mark. Now’s a good time to buy Yahoo!. I think I’ll join him on this trade since I blew it and failed to do that on the eBay/Amazon trade.