What’s up with SFTBY?

By xiexgp@gmail.com, September 23, 2014

SFTBY
How could this stock go down when it owns 34% of BABA.

Couldn’t they sell some on a secondary offering?

Also what was significance of SFTBY’s statement there would be dilution of stock with BABA’s input?

Comments welcome.

NickPerrone

This is a discussion topic or guest posting submitted by a Stock Gumshoe reader. The content has not been edited or reviewed by Stock Gumshoe, and any opinions expressed are those of the author alone.

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Travis Johnson, Stock GumshoeNicholas PerroneAllen B Recent comment authors

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Allen B
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I share your pain, Nick. I had a lot of call options on Yahoo, the second biggest holder of Alibaba and felt they should also rise on the successful IPO. However, as their share price declined, I had to bail out in a hurry as thousand of dollars in profit was disappearing. It shows that just because the main stock does well, its partners may not. I believe that the key holders of the two stocks made sure they took their profits and may have invested those into Alibaba. I understand now that my best play would have been to… Read more »

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nickperrone
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Thanks for your comments Allen.. I always felt Yahoo was not in good shape because the best (and maybe only) thing they had was their holding in BABA and they sold a good chunk of it on the IPO. Marissa was not making any significant changes which bolstered their outlook. But I understood that SFTBY had a good growing business and also has 34% of baba which is worth about $70B +.Travis had made some comments about SFTBY vs YHOO and seemed to lean towards SFTBY because of its essential strength. Perhaps he may have some thoughts about this seeming… Read more »

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Travis Johnson, Stock Gumshoe
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I do prefer Softbank to Yahoo — but Softbank carries a lot of debt as well and has the huge question of what to do with Sprint. If they had been able to merge Sprint with T-mobile as they wanted this would be a spectacular long-term buy — as it is, I think it’s a very well run and opportunistic company with some good potential in dozens of areas, but that doesn’t mean there’s a firm reason why it should be 20% cheaper or 20% more expensive at this particular moment. I’ve never owned any of the three (Sofbank, Alibaba… Read more »

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