Yahoo shares hit a five year low
Shares in Yahoo Inc. plummeted to their lowest point in five years yesterday. The dip is thought to have been caused by the weakening advertising market combined with increasingly tight regulatory scrutiny surrounding the proposed partnership with Google.
In a day that was turbulent for all technology stocks Yahoo emerged as one of the biggest losers, shedding five percent of its share value to close at $13.76 a share - this is the lowest price since 2003, when the company was still dealing with the dotcom bubble bursting. The stock has fallen 30 percent in the past month, admittedly amidst a broader market downturn that has seen the Dow itself drop seventeen points though Yahoo is falling at almost twice the rate leading some to speculate that there is much more than the credit crunch to blame.
Yahoo will, most likely, release its third quarter earnings on the 21st of this month though predictably the mood is not one of optimism amongst shareholders and executives. It’s a long way from earlier in the year when Microsoft looked into buying the California based company, at the time valuing the company’s at $31 a share.
An awful lot is now riding on the proposed advertising deal with Google. A decision in their favour would, no doubt, give them a rebound in terms of share price. However, a recommendation to block the deal from the US Justice Department might just administer a critical body blow to the company. Only time will tell.
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