Here's an interesting business story-An investment team lead by Warren Buffett and Quicken Loans-Cavs owner Dan Gilbert is looking to buy Yahoo's US operations. Yahoo's current stock value is largely due to its stake in Chinese internet retailer Alibaba as the core operations of Yahoo are sluggish and rather passe from a tech standpoint.
That's right up Buffett's alley.
He's made billions buying up mature companies that aren't trendy, don't have stratospheric growth rates but have a solid ongoing cash flow. Yes, he has lousy political tastes, but he knows his finance; he's been bragged on for three decades, as Berkshire Hathaway was talked about in my first finance class...ahem... 29 years ago. Those unsexy "value" stocks tend to do better than stocks with high growth rates, since folks will often overpay for those growth prospects and also overpay for trendy stock in the Next Big Thing.
Yahoo was a Next Big Thing a quarter-century ago, when it had a leading search engine back in the day that
"google" wasn't a verb. It also had one of the first ISP-independent e-mail services. However, those niches have become passe, as they now only have 3% of the e-mail market, being lapped by both Apple and Google's G-mail. It's also become a mark of old-fogie status to have a Yahoo account, only a step above having an AOL account.
<geezer voice>"Ah, yes, back in the mid 90s when the Web was hot of the presses. We had to use dial-up and 56K was considered hot stuff, I got my Yahoo account. Still have it. I do have a G-mail account as well, but I only use it to keep Google happy.</geezer voice>
That reminds me of the Lewis Black ad's trailer, where he talks of having three channels growing up. Paraphrase-"Modern kids would be sobbing like they're in a North Korean prison camp if they had to live with that", or a dial-up modem. "Phone Jacks? What are those? Don't you have a Wi-Fi router?"
Yes, I'm going to be getting senior discounts this summer.
Yes, Yahoo is now so stodgy, Buffett's interested in them. He owns Geico, too. Maybe he can sick their ad team on the Yahoo account and see what they can do with it. "So behind the curve, the cavemen have Yahoo accounts."
Paleo Cyber-diet anyone?