After a disappointing earnings report, stock for Yahoo experienced a large decline in value on Wednesday. The company is continuing to lose market share when it comes to online advertising.
Things have gotten so bad for Yahoo that investors are now saying that the company’s core business is actually worth less than zero dollars.
Yahoo has a total stock market value of $29.5 billion. This is extremely troubling when one looks at Yahoo’s assets.
With only $5.5 billion available to the company in cash and marketable securities, a $22.6 billion stake in the massive Chinese e-commerce platform Alibaba and $2.3 billion investments in equity interest, which are derived mostly from Yahoo Japan, Yahoo only has assets of $30.4 billion. This is less than $1 billion over the market cap for the company.
Furthermore, Yahoo would most likely be unable to sell its stake in Alibaba without paying a large amount in taxes. Based on that realization, Yahoo’s total assets are worth less than its market cap.
In essence, the company is essentially worthless.
The company says that it expects to earn $950 million by the end of this year, but investors do not care. Instead, they are quickly losing confidence in CEO Marissa Mayer. They say that Mayer will not be able to turn things around before the company collapses.
Since Yahoo has a negative value, many analysts are wondering if the company is even worth saving.
Yahoo is based in Sunnyvale, California. It offers many services including a search engine, email, news, advertising and more.
Yahoo will make history on Sunday when it will live stream a National Football League matchup between the Jacksonville Jaguars and the Buffalo Bills at 9am EST. By doing this, Yahoo will become the first website outside of the NFL to legally livestream an NFL matchup.