4 ms·

It is only me or is this a really good time to buy tech companies? We had so many acquisitions lately some of which don't even make that much sense apart from

It is only me or is this a really good time to buy tech companies? We had so many acquisitions lately some of which don't even make that much sense apart from the low price they where bought for.

toyg 10y ago
It's a good time to buy anything. Low interest rates across the board mean you can leverage cheap loans.
_pmf_ 10y ago
> apart from the low price they where bought for It's not low for German (I'd even argue: for European) standards.
- davidiach 10y ago
  Last year they had $666.9M in revenue and $73.61M in profits.[1] I would say it is pretty low. [1] https://finance.yahoo.com/quote/MWW/financials?p=MWW https://finance.yahoo.com/quote/MWW/financials?p=MWW
  - lpolovets 10y ago
    Their multiple is probably low because it looks like the business is shrinking: $764m in 2013, $726m in 2014, and $667m in 2015. I might be overgeneralizing, but it even looks like revenue is shrinking at an accelerating pace.
    - _pmf_ 10y ago
      > I might be overgeneralizing, but it even looks like revenue is shrinking at an accelerating pace. German here; they have ads everywhere; maybe they just spend too much at the moment.
      - smeyer 10y ago
        >they have ads everywhere; maybe they just spend too much at the moment. But the parent commenter was worrying about shrinking revenue, not profit. If anything, an overly aggressive advertising campaign should grow revenue while shrinking profit.
      - Kurtz79 10y ago
        Revenue it's not profit, and it's something that should be almost always positively correlated with advertising.
  - zaroth 10y ago
    I don't know what Yahoo is smoking. Their FY15 statements say that GAAP net income was $13.2 million on $666m of revenue. 2014 had $725m of revenue with a loss of $293m. This is a company that is slashing and burning.
blumentopf 10y ago
In German industry, there's plenty of angst that incumbents might be displaced by IT companies. E.g. Apple introduced their watch a bit more than a year ago and now they're dominating the smartwatch market, traditional swiss watchmakers can hardly get a foot in this space. So companies are trying to buy whatever they can afford in the hope of not ending up left behind. Porsche recently bought a stake in a parking app startup [1]. It all feels a bit like the dotcom era when so-called "old economy" companies frantically shelled out money to acquire "new economy" startups. Or like the stage shortly before the credit crunch in 2007 when dumb German Landesbanks piled subprime papers onto their balance sheet [2]. [1] http://www.intelligentmobilityinsight.com/news/ClB/Porsche-teams-with-parking-app http://www.intelligentmobilityinsight.com/news/ClB/Porsche-t... [2] http://archive.fortune.com/magazines/fortune/fortune_archive/2007/09/03/100172459/index.htm http://archive.fortune.com/magazines/fortune/fortune_archive...
- ethbro 10y ago
  To be fair, Swiss watchmakers have a long tradition of sticking their head in the sand when innovation happens. cough Quartz.
Snowdax 10y ago
It's not just you. That's why there have been so much M&A. Interests rates are low so getting loans to buy out your competition. In a time when VC money has (relatively) dried up and growth in many industries has slowed your competition are increasingly desperate to keep the lights on. A good few companies are pretty primed to sell right now.

It is only me or is this a really good time to buy tech companies? We had so many acquisitions lately some of which don't even make that much sense apart from the low price they where bought for.

toyg 10y ago

It's a good time to buy anything. Low interest rates across the board mean you can leverage cheap loans.

_pmf_ 10y ago

> apart from the low price they where bought for It's not low for German (I'd even argue: for European) standards.

davidiach 10y ago
Last year they had $666.9M in revenue and $73.61M in profits.[1] I would say it is pretty low. [1] https://finance.yahoo.com/quote/MWW/financials?p=MWW https://finance.yahoo.com/quote/MWW/financials?p=MWW
- lpolovets 10y ago
  Their multiple is probably low because it looks like the business is shrinking: $764m in 2013, $726m in 2014, and $667m in 2015. I might be overgeneralizing, but it even looks like revenue is shrinking at an accelerating pace.
  - _pmf_ 10y ago
    > I might be overgeneralizing, but it even looks like revenue is shrinking at an accelerating pace. German here; they have ads everywhere; maybe they just spend too much at the moment.
    - smeyer 10y ago
      >they have ads everywhere; maybe they just spend too much at the moment. But the parent commenter was worrying about shrinking revenue, not profit. If anything, an overly aggressive advertising campaign should grow revenue while shrinking profit.
    - Kurtz79 10y ago
      Revenue it's not profit, and it's something that should be almost always positively correlated with advertising.
- zaroth 10y ago
  I don't know what Yahoo is smoking. Their FY15 statements say that GAAP net income was $13.2 million on $666m of revenue. 2014 had $725m of revenue with a loss of $293m. This is a company that is slashing and burning.

blumentopf 10y ago

In German industry, there's plenty of angst that incumbents might be displaced by IT companies. E.g. Apple introduced their watch a bit more than a year ago and now they're dominating the smartwatch market, traditional swiss watchmakers can hardly get a foot in this space. So companies are trying to buy whatever they can afford in the hope of not ending up left behind. Porsche recently bought a stake in a parking app startup [1]. It all feels a bit like the dotcom era when so-called "old economy" companies frantically shelled out money to acquire "new economy" startups. Or like the stage shortly before the credit crunch in 2007 when dumb German Landesbanks piled subprime papers onto their balance sheet [2]. [1] http://www.intelligentmobilityinsight.com/news/ClB/Porsche-teams-with-parking-app http://www.intelligentmobilityinsight.com/news/ClB/Porsche-t... [2] http://archive.fortune.com/magazines/fortune/fortune_archive/2007/09/03/100172459/index.htm http://archive.fortune.com/magazines/fortune/fortune_archive...

ethbro 10y ago
To be fair, Swiss watchmakers have a long tradition of sticking their head in the sand when innovation happens. cough Quartz.

Snowdax 10y ago

It's not just you. That's why there have been so much M&A. Interests rates are low so getting loans to buy out your competition. In a time when VC money has (relatively) dried up and growth in many industries has slowed your competition are increasingly desperate to keep the lights on. A good few companies are pretty primed to sell right now.