One of the keys to having a valuation that's higher than your discounted cash flow is whether or not people think you can grow. Twitter, LinkedIn and Snapchat

One of the keys to having a valuation that's higher than your discounted cash flow is whether or not people think you can grow. Twitter, LinkedIn and Snapchat are all growth-stage companies so there is less relation between their valuation and the sum of their assets. Yahoo! is much closer to a mature company so their valuation is better determined by a sum of assets minus liabilities. With LinkedIn you had an obvious path to continue growing as well as a pretty obvious path to profitability whenever they decided to stop growing. Snapchat actually has pretty big growth prospects and has shown that they can monetize very well, so they can command a much higher multiple of their current earnings. Twitter's market cap is just over 2x what Yahoo! sold for, so it's not like people think they are THAT much more valuable, and their stock has taken quite a beating over the last year because they're showing that they don't have a path to growth.