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Vincent Padois, head tutor at the Pierre and Marie Curie University who teaches robotics and is babysitting the Paris ICub, makes a demonstration with ICub robot, a ?hybrid embodied cognitive system for a humanoid robot" about 1 metre (3.2 feet) high, at the Pierre and Marie Curie University in Paris September 4, 2009. Six versions of ICub exist in laboratories across Europe, where scientists are painstakingly tweaking its electronic brain to make it capable of learning, just like a human child and hoping it will learn how to adapt its behaviour to changing circumstances, offering new insights into the development of human consciousness. REUTERS/Philippe Wojazer

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    ANALYST VIEW: Microsoft's bid for Yahoo: Too high or too low?

    NEW YORK
    Fri Feb 1, 2008 1:00pm EST

    NEW YORK (Reuters) - Microsoft Corp's $44.6 billion bid to buy Yahoo Inc would, if completed, mark the biggest and boldest Internet deal since the Time-Warner AOL merger.

    Technology  |  Deals

    At $31 a share, the bid represents a 62 percent premium over Yahoo's Thursday closing price. Whether that is an appropriate price was an immediate subject of debate in financial circles.

    Following are view of analysts, fund managers, and academics on whether Microsoft is offering too much for Yahoo -- or might end up raising its bid.

    MICROSOFT BID IS TOO HIGH:

    TRIP CHOWDHRY, ANALYST, GLOBAL EQUITIES RESEARCH

    "I think Microsoft is paying too much. This company is not worth more than $20 per share and the reason I say that is... there are only two or three properties that Yahoo has that are worthwhile. The only two properties or three properties of Yahoo that are good are Yahoo Mail, Yahoo Answers and the third one is Yahoo Finance."

    TIM SMALLS, HEAD OF U.S. STOCK TRADING, EXECUTION LLC

    "To me, the premium seems exorbitant, for what is a dwindling business. I personally don't see how the synergies of Microsoft-Yahoo is going to take on Google."

    ANANT SUNDARAM, FINANCE PROFESSOR, DARTMOUTH

    "The $31 per share offer by Microsoft for Yahoo, for a total valuation of $44.6 billion, seems like a substantial overpayment. At a trailing PE ratio of over 40, Yahoo was already fairly high-priced. Microsoft's offer values Yahoo at 68 times its current year's earnings, and nearly 60 times its forecasted earnings for next year, both rather high by any stretch."

    MICROSOFT BID MAY GO HIGHER:

    MARK MAY, ANALYST, NEEDHAM & CO

    "I would not be surprised to see this bid have to be raised over time. I think there are companies out there like Comcast and Viacom and others that still need to address the emergence of online media and haven't. So there are clearly other strategic companies out there."

    LAURA MARTIN, ANALYST, SOLEIL-MEDIA METRICS

    "There could be a little more money on the table. The company is in play. Yahoo will not be able to stay independent. Other bidders will emerge before this is over. Not Google -- they can't even get DoubleClick closed; they won't get Yahoo closed."

    DEREK BROWN, ANALYST, CANTOR FITZGERALD

    "We expect a deal to happen, perhaps at a slight premium to the current offer, given Yahoo's weakened market position and Microsoft's obvious need to become more relevant in the consumer Internet services/online advertising arenas."

    (Reporting by Paul Thomasch)

    (Additional reporting by Michele Gershberg)
    Technology
    Deals


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