Yahoo! Inc. (NASDAQ:YHOO) has been having an eventful week with its core business being valued in the negative by some. Others, including options trader Pete Najarian, see it as a catalyst and an upside. Brothers Pete and Jon Najarian spoke about the upsides to Melissa Lee on CNBC’s Fast Money.
Pete Najarian, co-founder of optionMONSTER, had some very strong opinions about the influence of Alibaba Group Holding Ltd (NYSE:BABA) on Yahoo! Inc. (NASDAQ:YHOO). “As Alibaba goes, Yahoo gets swept up along the way as well,” he said. He also believed that Yahoo had plenty of catalysts which put the stock on the upside. First, and perhaps most important, in the list is that the company still holds a major part of Alibaba’s stock. Though some people valued Yahoo’s core business at zero or even in negative, he believed that the valuation was above zero. He was absolutely certain that Yahoo’s core business was an upside option.
Pete Najarian’s brother and co-founder of tradeMONSTER Jon Najarian agreed with the former about his views on Yahoo! Inc. (NASDAQ:YHOO)’s core business. He admitted that he had been negative about Yahoo’s stock over the past week, but it was only a short term. Now that the hedges are being lifted, it gave a chance to people who did not have huge money a chance at the game.
“The stock has to be gravitating higher after this hedge has been lifted,” he said and that is exactly the scenario which is being observed now. If Yahoo ever decides to put its stake in Alibaba Group Holding Ltd (NYSE:BABA) back into the market, it would set the company rich by about $5 billion to $9 billion. Add to this the some of their interests in other concerns and the final result puts Yahoo on the upside.
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