My Real Money YAHOO/DJ column is now on (free) TheStreet.com site:
"If Yahoo! grabs Dow Jones, (pardon the dirty word) the synergies
make a lot of sense. They get a primo media property that has a growing Web
presence that fits into Yahoo’s existing business model. And, it creates a
broader network to serve ads, both online and off. It’s a strong way to combine
the highly-sought-after, high-income demographic of the Dow Jones properties
with the high-volume Web traffic Yahoo! generates.
It also adds some bulk to an entity falling increasingly behind
archnemesis Google (GOOG) in the online advertising space. Yahoo! could
add another $1.783 billion per year in revenue — a nearly 30% bump for the
firm, which did $6.4 billion in total revenue in fiscal 2006 — and it also adds
another $386 million in profits, a number that almost doubles Yahoo!’s
profitability.
Yahoo sports a trailing price-to-earnings ratio near 60, while Dow Jones
trailing P/E ratio is near 18. If Wall Street puts an online multiple on the
revenue, it raises the potential stock price of the combination dramatically."
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Click on over and read the whole thing . . .
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Source:
Forget Murdoch: Yahoo! Should Buy Dow Jones
TheStreet.com, 5/9/2007 7:41 AM EDT
http://www.thestreet.com/markets/activetraderupdate/10355536.html
