Google's Motorola acquisition is just a 10% premium over their 2011 high(jeffreytalajic.com)
jeffreytalajic.com
Google's Motorola acquisition is just a 10% premium over their 2011 high
http://www.jeffreytalajic.com/2011/08/15/google-goes-bargain-hunting/
3 comments
I never understood this notion that the "fair value" of a company is somehow tied to anything but the price of its stock. If the fact that a stock used to be worth more than it is now means that it's somehow under priced then you'd have an easy arbitrage strategy on your hands. Google paid a 63% markup even though this author spins it as though they paid only 10% above some "true value".
by that logic when microsoft was trying to buy yahoo a couple of years ago they were getting a huge discount compared to the 2001 high. Microsoft should have really upped the offer.
Microsoft's offer assigned Yahoo's shares at the same value as Microsoft shares. It was a fair and it was questionable for Yahoo not to take it.
On the other side of that coin Microsoft is really lucky that Yahoo didn't take the offer.
On the other side of that coin Microsoft is really lucky that Yahoo didn't take the offer.
The reality is that before the recent drop stocks were over valued so all he's really saying is "they only paid a relatively small amount above a previous over valuation".