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You'd think this would affect the stock price, but currently YHOO only trading down 8 cents (-0.18%). I honestly see this all the time. What sounds like really

You'd think this would affect the stock price, but currently YHOO only trading down 8 cents (-0.18%). I honestly see this all the time. What sounds like really horrible news for a company, does not affect the price. Howerver, some random analyst or reporter who works at the Mercury Star Sun Inquirer writes a negative article or downgrade and the stock tanks. Doesn't make much sense.

TylerE 10y ago
Yahoo has zero value as a web property. What value there is on the name and the advertising side.
- nkozyra 10y ago
  To the parent comment's point, this is the sort of thing that should have a negative effect on brand/name.
- BinaryIdiot 10y ago
  > Yahoo has zero value as a web property What!? Surely you're being flippant. Alexa currently ranks Yahoo.com as #5 worldwide and in the United States. NUMBER 5! How anyone could think that has zero value makes no sense to me.
  - pcurve 10y ago
    Yeah I keep hearing the same thing, but obviously it's at least worth around what Verizon paid for it. I think it's actually worth more, but there is so much hate for the company and its management team.
    - ixtli 10y ago
      While the thing you're responding to is obviously idiotic it occurs to me that the sanity of the valuation of Yahoo! is not "obvious" at all. It's a result of the application of partially visible heuristics to determine the worth of things like users, views, "talent," and etc, all passed through back-room dealing at the executive level and bargaining behind closed doors. The reason I bother coming here to say this is that I think the idea that 4.8 billion dollars "makes sense" to an outsider is endemic of thinking that leads to a dangerous lack of regulation. In other words, I'd be careful not to assume that the left hand always knows what the right hand is doing in companies at this scale.
  - kolbe 10y ago
    Your statement doesn't imply value at all. If I created a web site that gave every visitor $1, it would amass an amazing number of visitors, but would be a worthless business.
    - pbhjpbhj 10y ago
      Yahoo are giving away money? No, of course not. So how does your logic apply. People are visiting Yahoo because they want to use Yahoo services ... even if they're not then they're still visiting, that is valuable to online businesses where a lot of marketing goes in to just getting visitors. > it would amass an amazing number of visitors, but would be a worthless business. // You'd get in serious debt. But the website would still be worth something afterwards, not what you paid, but it would have a significant value. Good marketing could convert some of those repeat visitors looking for free money. Indeed, it actually sounds like not a half bad idea! Give away money via paypal/bitcoin or some such up to a limit for a few days, network effect is going to amplify that, then stop and lay out your stall .. if your stall was using bitcoin/paypal for micro payments then double+plus+good! You'd have stories in press around the world, everyone would be sharing your site ("Hey I got free money 2 days in a row at example.com"). Want to cause a riot? Release $100k in $1 notes in public in a busy, large, public space (Central Park?). Say you'll be back next week ... how many millions of people do you think you could attract, how many the 3rd week!!? How much would the press coverage and whatever brand association you could muster be worth? Anyway, I digress.
- gcb0 10y ago
  you are drinking too much of the kool aid microsoft shills filed the news with when they were trying to forcefully acquire yahoo. doubt if yahoo will ever recover. specially on the valley.
brian-armstrong 10y ago
It only matters if it affects how people interact with Yahoo's business or if it results in fines or lawsuits. Since it probably won't do any of these, it does make sense that it doesn't affect their share price.
kolbe 10y ago
Investors are conflicted: on the one hand, Yahoo had a data breach that will cost them trust, but on the other hand, investors are surprised to hear there are still 500 million Yahoo users.
- artursapek 10y ago
  Nobody said they were active users.
  - giarc 10y ago
    I use Yahoo for fantasy sports. When I signed up I was forced to register a RocketMail account. Logging into Yahoo Fantasy is the only thing I've used it for. I wonder how many other people are in this scenario. Some hacker might have my password, hopefully they don't pull Aaron Rodgers from my line up this week.
    - willow9886 10y ago
      Yahoo's been authenticating me nearly every time I try to access the fantasy app on my phone. They've made me change my password 3 times in the past month or so. And the password I set doesn't seem to work, so I keep having to use their phone based authentication. With all the money that they have, it's hard to fathom how Yahoo is so bad at delivering secure identity services.
      - tbomb 10y ago
        I started using their "Account Key" process, any time I log in on the site from a computer, I get a notification from my Yahoo sports app (iPhone) asking me if I would like to allow the login attempt. I actually like it better than the two-factor auth I use for other accounts. Whether it's more secure or not, I don't know.. EDIT: just for clarification, this replaces the password entirely. So I never enter a password on the site.
        pkaeding 10y ago
pbarnes_1 10y ago
YHOO is being bought by Verizon. The stock price will not move out of a fixed range.
- 1024core 10y ago
  YHOO still owns a chunk of BABA. If (for whatever reason) BABA shoots up (or down), expect the stock price to follow very closely.
- bjackman 10y ago
  Hm, I didn't know that. It's mildly funny, because the company that owns Sprint (Softbank, who recently bought ARM) also owns Yahoo Japan.
- Iv 10y ago
  Could Verizon be buying every share under a given price, to cheapen the deal? Would this be allowed at this point in the negotiation?
withdavidli 10y ago
In this case, most are looking to how Verizon responds. The share price should be near equivalent to acquisition price. Verizon pulling out of the deal would see it plummet in my opinion. Edit: acquisition offer usually priced into share price, harder to calculate in this situation since Verizon isn't buying the whole company and all assets.
- vegabook 10y ago
  It is almost certain that this evolving risk was disclosed to Verizon (and other officially interested parties) during the initial stages of the sale negotiating process, and could well explain the difficult gestation of the Yahoo sale. Note that standard procedure would have been for interested parties wishing to enter into formal discussions, to sign watertight non-disclosures at the risk of very big legal liabilities if they don't abide by them. Any M&A professional would know that the valuation hit of "owning up early" is much smaller than the catastrophic effect of trying to hide such a thing until the inevitable noisy leak.
deleted 10y ago
[deleted]
mathattack 10y ago
The horrible news is already baked in. The entire value of the company is Ali Baba. If this breaks the acquisition or causes shareholder suits, then it's a problem.
delegate 10y ago
The price of the stock has little to do with how the company does it's business or what it does. It is as much about other investors as it is about the company itself. The motivation there is pure profit, not some higher moral purpose or justice or "make the world better" idealism. The stock price indirectly affects the company performance, just as the company performance affects the stock price, so it's a feedback loop (or conflict?) created between the investors and the company. Apparently, investors think that this hack won't affect yahoo's performance or stock price. These is just my interpretation of it of course, I guess very few people (if any) actually understand all the forces at play here.
bkeroack 10y ago
Almost all of Yahoo's value is in its Alibaba holding. https://www.bloomberg.com/view/articles/2015-12-02/yahoo-is-looking-for-a-new-way-around-alibaba-taxes https://www.bloomberg.com/view/articles/2015-12-02/yahoo-is-... "Yahoo's actual core business of being Yahoo (and Tumblr and whatever) is worth negative $13 billion" "Even after deducting 38 percent from the value of [the Alibaba shares] to account for taxes, you get a value for Yahoo's actual business of just $1.7 billion"
- ojbyrne 10y ago
  Actually the part you elide is technically not [the Alibaba shares] but [the Alibaba and Yahoo Japan] shares. But it doesn't really weaken your argument as much as it seems to be, because Yahoo Japan is really separate from Yahoo, despite the name.
deleted 10y ago
[deleted]
Johnie 10y ago
Isn't this news old though? The original news was from Aug. Today, they are just confirming that it was accurate. Original news: http://www.bbc.com/news/technology-36952257 http://www.bbc.com/news/technology-36952257 On that day, the stock dropped 1%
lesdeuxmagots 10y ago
YHOO mostly tracks BABA. BABA is up over 3% today. If YHOO is flat, then it's actually down about 3%.
- chimeracoder 10y ago
  > YHOO mostly tracks BABA. BABA is up over 3% today. If YHOO is flat, then it's actually down about 3%. This is correct. For reference, $YHOO, $BABA, and $SPY all one one graph: https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximized&chdeh=0&chfdeh=0&chdet=1474315200000&chddm=197455&chls=IntervalBasedLine&cmpto=NASDAQ:YHOO;NYSEARCA:SPY&cmptdms=0;0&q=NYSE:BABA&ntsp=0&ei=rkzkV-GtEKb_igL_54eoAg https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&...
joelthelion 10y ago
It makes a lot of sense if you consider that most users don't give a damn about security.
- chris_wot 10y ago
  They do when their identity is stolen.
rasz_pl 10y ago
horrible how? was anyone ever significantly penalized for being hacked?
doh 10y ago
Many hedge funds spent time analyzing the effect on a stock price after breach disclosure. From what I read overall, the only negative effect comes if the breach is repeated over longer period of time in media. But as Elena Kvochko put it, "shareholders are numb to news of data breaches" [0]. [0] https://hbr.org/2015/03/why-data-breaches-dont-hurt-stock-prices https://hbr.org/2015/03/why-data-breaches-dont-hurt-stock-pr...
joering2 10y ago
> You'd think this would affect the stock price, but currently YHOO only trading down 8 cents (-0.18%). Why would the stock be affected? Yahoo emails are free. Even if majority is hacked this won't make dent in their revenue streams coming mostly from advertising.
redbeard0x0a 10y ago
It doesn't affect stock price because it doesn't really affect the money being made. There aren't going to be any huge fines that need to be paid, they aren't really going to lose customers explicitly due to this. After all, it was _hackers_ that broke in and did bad things, you can't completely protect yourself from hackers. If the difference between having a secure company and an insecure company were cut and dry, then it might have an affect. But the entire security landscape is so nuanced and complicated that the average person watching/reading the news isn't going to know the difference between 2 different companies (one with good security practices and one without).
- MarkMc 10y ago
  I wonder whether a marketing campaign focused on security would be effective. For example, "We are the only accounting software to use end-to-end encryption of your financial data. Don't trust your sensitive data with anyone else!"
tim333 10y ago
Yahoo are forever having security breaches. I think people kind of take it for granted.
sam-mueller 10y ago
Actually, the stock price is being majorly affected today! YHOO usually tracks BABA quite precisely, and BABA was up big today (+3.5%). This usually means that YHOO would be up around 2%, which equates to nearly $1.00 in upside. Instead it was flat today. To make matters worse, YHOO has actually fallen off quite a bit since BABA reached $105/share 1.5 weeks ago, and YHOO corresponded with a high of around $45. If you do the math, with BABA currently nearing $110, YHOO should actually be just north of $46. tl;dr YHOO shares are actually suffering, but it's harder to see if you're not familiar with the underlying mechanisms at play.
netik 10y ago
Harvard Business review has a pretty good paper on this. https://hbr.org/2015/03/why-data-breaches-dont-hurt-stock-prices https://hbr.org/2015/03/why-data-breaches-dont-hurt-stock-pr...
droopybuns 10y ago
Security mistakes do not make lasting impacts on stock prices in my experience. They tend to be a little hiccup, but afterwards things keep moving along on the existing trend. A cluster of security mistakes in other companies does seem to increase the price of stocks like FEYE, CUDA & FTNT.
nikcub 10y ago
Two reasons: 1. this leak is old, we found out about it in August 2. Yahoo is already heavily discounted to the point where without BABA they have a negative value.
ekianjo 10y ago
Stock price is defined by the expectation of future earnings. If investors have seen in the past that security breaches have no impact on other businesses, why should they react to this ? SONY has had a much worse security breah not too long ago (with stuff stored in plain text!) and people kept using SONY online services anyway.
dforrestwilson1 10y ago
Yahoo is being bought by Verizon, so unless VZ know decides to not purchase YHOO, the stock price is pretty much hard-coded. Otherwise there would be an arbitrage opportunity.

TylerE 10y ago

Yahoo has zero value as a web property. What value there is on the name and the advertising side.

nkozyra 10y ago
To the parent comment's point, this is the sort of thing that should have a negative effect on brand/name.
BinaryIdiot 10y ago
> Yahoo has zero value as a web property What!? Surely you're being flippant. Alexa currently ranks Yahoo.com as #5 worldwide and in the United States. NUMBER 5! How anyone could think that has zero value makes no sense to me.
- pcurve 10y ago
  Yeah I keep hearing the same thing, but obviously it's at least worth around what Verizon paid for it. I think it's actually worth more, but there is so much hate for the company and its management team.
  - ixtli 10y ago
    While the thing you're responding to is obviously idiotic it occurs to me that the sanity of the valuation of Yahoo! is not "obvious" at all. It's a result of the application of partially visible heuristics to determine the worth of things like users, views, "talent," and etc, all passed through back-room dealing at the executive level and bargaining behind closed doors. The reason I bother coming here to say this is that I think the idea that 4.8 billion dollars "makes sense" to an outsider is endemic of thinking that leads to a dangerous lack of regulation. In other words, I'd be careful not to assume that the left hand always knows what the right hand is doing in companies at this scale.
- kolbe 10y ago
  Your statement doesn't imply value at all. If I created a web site that gave every visitor $1, it would amass an amazing number of visitors, but would be a worthless business.
  - pbhjpbhj 10y ago
    Yahoo are giving away money? No, of course not. So how does your logic apply. People are visiting Yahoo because they want to use Yahoo services ... even if they're not then they're still visiting, that is valuable to online businesses where a lot of marketing goes in to just getting visitors. > it would amass an amazing number of visitors, but would be a worthless business. // You'd get in serious debt. But the website would still be worth something afterwards, not what you paid, but it would have a significant value. Good marketing could convert some of those repeat visitors looking for free money. Indeed, it actually sounds like not a half bad idea! Give away money via paypal/bitcoin or some such up to a limit for a few days, network effect is going to amplify that, then stop and lay out your stall .. if your stall was using bitcoin/paypal for micro payments then double+plus+good! You'd have stories in press around the world, everyone would be sharing your site ("Hey I got free money 2 days in a row at example.com"). Want to cause a riot? Release $100k in $1 notes in public in a busy, large, public space (Central Park?). Say you'll be back next week ... how many millions of people do you think you could attract, how many the 3rd week!!? How much would the press coverage and whatever brand association you could muster be worth? Anyway, I digress.
gcb0 10y ago
you are drinking too much of the kool aid microsoft shills filed the news with when they were trying to forcefully acquire yahoo. doubt if yahoo will ever recover. specially on the valley.

brian-armstrong 10y ago

It only matters if it affects how people interact with Yahoo's business or if it results in fines or lawsuits. Since it probably won't do any of these, it does make sense that it doesn't affect their share price.

kolbe 10y ago

Investors are conflicted: on the one hand, Yahoo had a data breach that will cost them trust, but on the other hand, investors are surprised to hear there are still 500 million Yahoo users.

artursapek 10y ago
Nobody said they were active users.
- giarc 10y ago
  I use Yahoo for fantasy sports. When I signed up I was forced to register a RocketMail account. Logging into Yahoo Fantasy is the only thing I've used it for. I wonder how many other people are in this scenario. Some hacker might have my password, hopefully they don't pull Aaron Rodgers from my line up this week.
  - willow9886 10y ago
    Yahoo's been authenticating me nearly every time I try to access the fantasy app on my phone. They've made me change my password 3 times in the past month or so. And the password I set doesn't seem to work, so I keep having to use their phone based authentication. With all the money that they have, it's hard to fathom how Yahoo is so bad at delivering secure identity services.
    - tbomb 10y ago
      I started using their "Account Key" process, any time I log in on the site from a computer, I get a notification from my Yahoo sports app (iPhone) asking me if I would like to allow the login attempt. I actually like it better than the two-factor auth I use for other accounts. Whether it's more secure or not, I don't know.. EDIT: just for clarification, this replaces the password entirely. So I never enter a password on the site.
      - pkaeding 10y ago

pbarnes_1 10y ago

YHOO is being bought by Verizon. The stock price will not move out of a fixed range.

1024core 10y ago
YHOO still owns a chunk of BABA. If (for whatever reason) BABA shoots up (or down), expect the stock price to follow very closely.
bjackman 10y ago
Hm, I didn't know that. It's mildly funny, because the company that owns Sprint (Softbank, who recently bought ARM) also owns Yahoo Japan.
Iv 10y ago
Could Verizon be buying every share under a given price, to cheapen the deal? Would this be allowed at this point in the negotiation?

withdavidli 10y ago

In this case, most are looking to how Verizon responds. The share price should be near equivalent to acquisition price. Verizon pulling out of the deal would see it plummet in my opinion. Edit: acquisition offer usually priced into share price, harder to calculate in this situation since Verizon isn't buying the whole company and all assets.

vegabook 10y ago
It is almost certain that this evolving risk was disclosed to Verizon (and other officially interested parties) during the initial stages of the sale negotiating process, and could well explain the difficult gestation of the Yahoo sale. Note that standard procedure would have been for interested parties wishing to enter into formal discussions, to sign watertight non-disclosures at the risk of very big legal liabilities if they don't abide by them. Any M&A professional would know that the valuation hit of "owning up early" is much smaller than the catastrophic effect of trying to hide such a thing until the inevitable noisy leak.

deleted 10y ago

[deleted]

mathattack 10y ago

The horrible news is already baked in. The entire value of the company is Ali Baba. If this breaks the acquisition or causes shareholder suits, then it's a problem.

delegate 10y ago

The price of the stock has little to do with how the company does it's business or what it does. It is as much about other investors as it is about the company itself. The motivation there is pure profit, not some higher moral purpose or justice or "make the world better" idealism. The stock price indirectly affects the company performance, just as the company performance affects the stock price, so it's a feedback loop (or conflict?) created between the investors and the company. Apparently, investors think that this hack won't affect yahoo's performance or stock price. These is just my interpretation of it of course, I guess very few people (if any) actually understand all the forces at play here.

bkeroack 10y ago

Almost all of Yahoo's value is in its Alibaba holding. https://www.bloomberg.com/view/articles/2015-12-02/yahoo-is-looking-for-a-new-way-around-alibaba-taxes https://www.bloomberg.com/view/articles/2015-12-02/yahoo-is-... "Yahoo's actual core business of being Yahoo (and Tumblr and whatever) is worth negative $13 billion" "Even after deducting 38 percent from the value of [the Alibaba shares] to account for taxes, you get a value for Yahoo's actual business of just $1.7 billion"

ojbyrne 10y ago
Actually the part you elide is technically not [the Alibaba shares] but [the Alibaba and Yahoo Japan] shares. But it doesn't really weaken your argument as much as it seems to be, because Yahoo Japan is really separate from Yahoo, despite the name.

deleted 10y ago

[deleted]

Johnie 10y ago

Isn't this news old though? The original news was from Aug. Today, they are just confirming that it was accurate. Original news: http://www.bbc.com/news/technology-36952257 http://www.bbc.com/news/technology-36952257 On that day, the stock dropped 1%

lesdeuxmagots 10y ago

YHOO mostly tracks BABA. BABA is up over 3% today. If YHOO is flat, then it's actually down about 3%.

chimeracoder 10y ago
> YHOO mostly tracks BABA. BABA is up over 3% today. If YHOO is flat, then it's actually down about 3%. This is correct. For reference, $YHOO, $BABA, and $SPY all one one graph: https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&chvs=maximized&chdeh=0&chfdeh=0&chdet=1474315200000&chddm=197455&chls=IntervalBasedLine&cmpto=NASDAQ:YHOO;NYSEARCA:SPY&cmptdms=0;0&q=NYSE:BABA&ntsp=0&ei=rkzkV-GtEKb_igL_54eoAg https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&...

joelthelion 10y ago

It makes a lot of sense if you consider that most users don't give a damn about security.

chris_wot 10y ago
They do when their identity is stolen.

rasz_pl 10y ago

horrible how? was anyone ever significantly penalized for being hacked?

doh 10y ago

Many hedge funds spent time analyzing the effect on a stock price after breach disclosure. From what I read overall, the only negative effect comes if the breach is repeated over longer period of time in media. But as Elena Kvochko put it, "shareholders are numb to news of data breaches" [0]. [0] https://hbr.org/2015/03/why-data-breaches-dont-hurt-stock-prices https://hbr.org/2015/03/why-data-breaches-dont-hurt-stock-pr...

joering2 10y ago

> You'd think this would affect the stock price, but currently YHOO only trading down 8 cents (-0.18%). Why would the stock be affected? Yahoo emails are free. Even if majority is hacked this won't make dent in their revenue streams coming mostly from advertising.

redbeard0x0a 10y ago

It doesn't affect stock price because it doesn't really affect the money being made. There aren't going to be any huge fines that need to be paid, they aren't really going to lose customers explicitly due to this. After all, it was _hackers_ that broke in and did bad things, you can't completely protect yourself from hackers. If the difference between having a secure company and an insecure company were cut and dry, then it might have an affect. But the entire security landscape is so nuanced and complicated that the average person watching/reading the news isn't going to know the difference between 2 different companies (one with good security practices and one without).

MarkMc 10y ago
I wonder whether a marketing campaign focused on security would be effective. For example, "We are the only accounting software to use end-to-end encryption of your financial data. Don't trust your sensitive data with anyone else!"

tim333 10y ago

Yahoo are forever having security breaches. I think people kind of take it for granted.

sam-mueller 10y ago

Actually, the stock price is being majorly affected today! YHOO usually tracks BABA quite precisely, and BABA was up big today (+3.5%). This usually means that YHOO would be up around 2%, which equates to nearly $1.00 in upside. Instead it was flat today. To make matters worse, YHOO has actually fallen off quite a bit since BABA reached $105/share 1.5 weeks ago, and YHOO corresponded with a high of around $45. If you do the math, with BABA currently nearing $110, YHOO should actually be just north of $46. tl;dr YHOO shares are actually suffering, but it's harder to see if you're not familiar with the underlying mechanisms at play.

netik 10y ago

Harvard Business review has a pretty good paper on this. https://hbr.org/2015/03/why-data-breaches-dont-hurt-stock-prices https://hbr.org/2015/03/why-data-breaches-dont-hurt-stock-pr...

droopybuns 10y ago

Security mistakes do not make lasting impacts on stock prices in my experience. They tend to be a little hiccup, but afterwards things keep moving along on the existing trend. A cluster of security mistakes in other companies does seem to increase the price of stocks like FEYE, CUDA & FTNT.

nikcub 10y ago

Two reasons: 1. this leak is old, we found out about it in August 2. Yahoo is already heavily discounted to the point where without BABA they have a negative value.

ekianjo 10y ago

Stock price is defined by the expectation of future earnings. If investors have seen in the past that security breaches have no impact on other businesses, why should they react to this ? SONY has had a much worse security breah not too long ago (with stuff stored in plain text!) and people kept using SONY online services anyway.

dforrestwilson1 10y ago

Yahoo is being bought by Verizon, so unless VZ know decides to not purchase YHOO, the stock price is pretty much hard-coded. Otherwise there would be an arbitrage opportunity.