Breakfast Links?

3:49 am (Hawaii) LinkedIn's IPO price was $45, but CNBC is reporting that it's jacked up in a crowded-as-heck trading floor in NYC to $85. Sure smells like 1998 all over again. It isn't exactly as bad; at least LNKD had $3 mil in profit last year. Back in the dotcom bubble era, there were 10 bombs for every AOL or AMZN or EBAY or YHOO. So many companies that were bleeding money.

If LNKD opens at 85, it has nowhere to go but down. Good luck if you buy above 100. The profit-takers are going to exit the theater long before it catches on fire and the roof comes down on bagholders. Back when GOOG was an IPO, the best time to enter was a few months after the debut, when shares plummeted. Then it ran and ran and ran.

Whatever the case, this will make for great entertainment. Maybe a circus. Even AGQ might not be as hyper as LNKD, just for today.

Update 4:07 am (Hawaii) Freakalytics estimates LNKD's float at roughly 94.5 mil shares. LNKD went from 83 to 92.99 to 84.43 in less than 10 minutes. Just watching and being entertained here. 100% cash.

Freakalytics: LNKD analysis, insights (May 19 2011)

In the Year 2000 . . .

Once upon a time, there was a fantastic site named Google. Sooner or later, almost all web surfers adopted this nifty search engine as a tool to the finding answers to the questions of the Universe. Its stock, once unleashed upon said Universe, dipped and meandered for a few months, but eventually picked up steam and dashed up the steep mountain like a rocket. From 85 to 125 in such a short time, I recall, during my one brief stay on board Rocket Google. I should've held, but whatever. It later split 3-for-1 and is currently at 626. That would've been a 20-bagger, if my math is right.

So, with Facebook showing signs of a similar path — maybe an IPO in 2012? — can we say that its stock will follow a similar trajectory to GOOG? It's a tough call. I still don't understand how web ads translate to revenues based only on clicks and views, but if merchants buy it (literally) and money sweeps into the hallways of Facebook, what more do I need to know?

A Facebook IPO and the years of trading the stock to come will be interesting. I don't know how bullish or bearish I'd be on it, but it'll be polarizing, maybe. Is it GOOG? Is it YHOO? In between? Is Facebook really worth $53,000,000,000?

Facebook could follow this ziggety zag. Or not.

Yahoo revisited

I got rid of my YHOO shares a few months ago, unexcited but satisfied to escape with a small profit.


What a dud.

Google tossing a wrench into MicroHoo

Michael Arrington loves the rumor mill. Can't blame him. I mean, Google buying a chunk of Yahoo? How gossipy and unlikely is that?

Pupule's week in review: Oww!

Sold Yahoo and Disney for decent profits of 5.3% and 4.6%. A decent start, even if it required holding through almost two weeks of soap-opera wackiness on Yahoo's part.

Closed the week on a bummer, though, after mistiming Yingli. Down 12.7% in just 24 hours. Even though my flaky theories about the end of the week have some credence, I went against them. My theories?

1. Earnings reports released late in the week (Thursday or Friday) are usually bearish and negative and plainly suck. (And earnings early in the week are usually bullish, i.e. FSLR.)

2. A buy on Thursday is no good most times, and a buy on Friday morning is horrible.

3. The best time to buy is often at the closing bell on Friday.

All these have been fairly true, I've found. But I still bought Yingli Green Energy on Thursday at 24.80. Near its recent high (25.50). It sank the rest of the day, but finished at 24.88. Earnings report before the opening bell today was good, but didn't beat expectations. The run was done (18 to 25 in one week) and sellers stormed the castle. By the end of the day, YGE was below 22 and I wondered ... why am I still trading on a whim? I put my homework and caution into DIS and YHOO. With YGE, I did not respect the recent movement in the stock. I assumed. And you know what happens to people who assume. Yep, they are ASSes. I'm an ass.

So, I'm holding the bag on YGE, promising myself (again) to never buy a stock going into earnings. It's almost like former UH football coach Dick Tomey's philosophy about passing. He often said that three things happen when you throw, and two are bad: 1. completion, 2. incompletion, 3. interception.

Earnings? 1. The Co beats estimates and raises guidance, 2. beats estimates, neutral guidance, 3. meets estimates, but doesn't surpass. The latter two mean the stock plummets in this bearish market. That's what happened to YGE. And if I had waited until the close, I could've gotten shares at 21.65, if I wanted.

Some YGE enthusiasts would probably average down here, but I'm against that method. There's too much momentum, too many bears in the stock. It takes so little to beat YGE down and takes a lot to bring it back up. If the market retests recent lows, YGE will sink, perhaps all the way to 18 as it did last month.

Volume today was monstrous, the most ever in YGE. Gap down, 11 million shares traded... completely bearish. I would've been better off sleeping through the market yesterday and today.

Two wrongs don't make a Yang right

Roger Ehrenberg explains why a Yahoo-News Corp. deal would suck royally for YHOO shareholders. Frankly, I wouldn't mind having YHOO shares, even though I emptied out yesterday with a small profit (5%). But Ehrenberg has valid points, and clearly believes that Microsoft will swoop in via YHOO longs.

I can't help thinking that Jerry Yang is putting forth a front about fighting for Yahoo's independence. I can't help thinking that he has to do this to get shareholders their best price point from MSFT. Maybe $34. Maybe $35. And I can't help but think that he has to save face with his underling Yahoos in light of recent layoffs. I don't think he wants the ship to go down, and that's what will eventually happen if MSFT doesn't take over. It could happen even if MSFT takes over.

What I'm saying is, Google is king of the world.

Yahoo board splits into camps

Oh, the civil war within Yahoo is fierce. I'm glad to be out of YHOO, but the drama ... I am moth to light on this soap opera.

>> New York Post: Board Bucks Jerry

Goodbye Mickey, Yahooligans

Took my Disney and Yahoo shares off the table early in the day. (Before I fell asleep for the final five-plus hours of the session.)

Sold YHOO @ 29.90
net +1.51 (+5.3%)

Sold DIS @ 32.65
net +1.45 (+4.6%)

Wasn't happy about losing some gains on Disney at the open, but it was the right move as the market swooned. Dow down 171 (1.4%) and Nasdaq down 41 (1.7.%). Both held up rather well: YHOO closed at 29.96. DIS closed at 32.30. Still like them as trading vehicles. Just not in this environment. Market was due for a selloff.

Yahoo-MySpace makes little sense

A logical breakdown of the Yahoo-News Corp. talks (et al MySpace) by Hammerin' Hank Blodget.

>> Yahoo-MySpace: A Microsoft Alternative, But A Bad Deal

Tough to argue with his line of reasoning. I'm still holding my YHOO shares ... but antsy for Jerry Yang to do something already.

Microsoft still holds trump card

Michael Arrington (Tech Crunch) says a News Corp.-Yahoo spooning would not be so smooth.

One major snag - it is widely believed that, even with a News Corp. deal, Yahoo would need to outsource search marketing to Google to make the numbers work. While Google is likely happy to do that deal, it’s unlikely U.S. regulatory agencies would approve it...

Hold yer MicroHoo horses

SAI's Peter Kafka writes that a News Corp.-Yahoo agreement could put the kabosh on Microsoft's takeover plan. He says News Corp. wouldn't buy Yahoo, but fork over online pieces like MySpace in exchange for a significant equity stake.

>> Yahoo-News Corp Still Talking, Deal Still Possible

Who knows what will come of it. The soap opera never ends.

A boost for the Yahoo troops

Gotta hand it to Yahoo and CEO Jerry Yang. As Henry Blodget notes, Yang's newest e-mail to employees spells out the horizon (somewhat) and drives a flag into the company's turf. Cemented, perhaps. Or maybe just temporary, until Microsoft hikes that takeover price to $35 per share.

>> Grading Jerry's Latest Email to the Yahoo Troops: "A-"

The e-mail alone may have been the best reason why YHOO shares bumped over 30 after hours. It certainly didn't hurt YHOO longs that Steve Ballmer swore over his pirate ancestors' graves that he will continue to push for a takeover. OK, I made up the pirate stuff. But he's just as carnivorous.

MSFT offered $35?

So, Microsoft's previous offer for Yahoo was $35. Or so says Henry Blodget. This would explain why YHOO is up more than 2% so far ($29.82). The Nasdaq is up 13 points (0.56%) and 19 of my Top 25 are in the green. I expected Yahoo to be down today after its board rejected MSFT's offer and countered with a $40 demand.

>> Yahoo's "AOL Talks"--More Smart Smoke From Yahoo's Advisors

The "smokescreeen" talk may or may not be helping. Something's helping. MSFT is down 1.6% to 28.08.

Yahoo counters with $40 demand

It's a big-time poker game and Yahoo has responded to Microsoft's move. Silicon Alley Insider's Henry Blodget has another astute analysis.

>> How Will MSFT Respond To YHOO's Counter?

Our current guess, therefore, is that Microsoft will respond to Yahoo's counter-offer by trying to win over Yahoo's big shareholders and biding its time.

Paul Kedrowsky, however, has a higher value on Yahoo than Blodget does.

>> Yahoo: Rejecting Microsoft; Entering the Bargaining Stage

Is Yahoo right to bargain? Sure. Most sum-of-parts analysis of Yahoo -- my own included -- puts Yahoo's breakup value somewhere between $35 and $42, depending on how much you want to trust the valuations of Alibaba and Yahoo Japan. That's materially over Microsoft's offer, doubly so if you consider that Microsoft has a legitimate strategic interest in owning Yahoo, making this more than a purely valuation-driven exercise.

Why Yahoo + Google would be a nightmare

Michael Arrington breaks down the illogical long-term consequences of a possible Yahoo-Google agreement. He makes it simple enough that, well, even a Yahoo loyalist would have to agree.

>> Yahoo Board to Decide Fate of Company Today

Blodget's proposal has common cents

Like him or not, Henry Blodget is churning out insights and even solutions for the Microsoft-Yahoo bizarro circus.

>> Here's a Better Deal

So, what's the answer? Jerry and Steve hammer out a deal in which Microsoft trades its Internet division plus $10-$15 billion of cash for half of a stand-alone Yahoo (the exact percentage, board seats, etc. depending on the amount of cash). Steve can be chairman. The new board can agree on the management team.

Such a strange love triangle

The Yahoo Love Triangle pushed YHOO shares to 29.50 mid-day (now at 29.33 in after hours), quite impressive for a Co that simply doesn't know how to monetize properly. Don't get me wrong. I have my YHOO shares for trading purposes because, whether the Co likes it or not, it is in the sweet spot. It is the apple (no pun intended) in Mr. Softee's eye. It is also being lusted after by the search gods of Google.

It's all enough to make a man quit watching As the World Turns permanently. Not that I watch soaps. (Does Lost count as one?)

Fred Wilson speaks of Google's impending and complete dominance of search and advertising, and it is nearly impossible to counter his argument. I was late to the Google search world. Think it was 2001 or '02 when I finally started using their technology and I haven't wavered since. I mean, who uses Yahoo search when Google's is superior?

Wilson lays out a plan (I've seen a similar idea at Silicon Alley Insider by Henry Blodget) that would keep Yahoo independent. Either way, I think my shares of Yahoo will climb a bit more. I'm holding for now.

Saturday afternoon

Some productive reading this afternoon: Chris Perruna (particularly Trading Mistakes: Avoid At All Costs), Silicon Alley Insider and Seeking Alpha. The observations about Microsoft-Yahoo never fail to be interesting.

He who fight and run away ...

Just like Robert Nesta Marley once said, "He who fight and run away lives to fight another day." I gave up on the Google trade. I still think the stock will recover from the selloff, but today's Microsoft-Yahoo news is too powerful. The kicker came at about 15 minutes before the close when CNBC quoted Mark Cuban saying (paraphrasing) that this move by MSFT is brilliant and creates a dominant player in everything online except search. For Google, Cuban adds, it leaves only search as a dominant niche.

I got out at 521, took my loss and moved on. GOOG is now at 516.

I moved into YHOO at 28.39 — a buck higher than it was early in the day. I saw it at 27.40 or so and thought it was too simple and easy. Something had to be wrong with a stock hovering there after receiving an offer of 31.

Since overthinking that non-trade, I'm now in a stock I normally dislike. I use Yahoo Finance and Yahoo Fantasy Sports, like tens of millions of people, but that has nothing to do with the performance of the stock.

(No different from Starbucks. I go there often, but don't want the stock.)

With Terry Semel's resignation yesterday, I think Jerry Yang will give this deal his blessing and spare Yahoo the torturous road to ruin.

Yang has his beeellions. I'll be content to make a few bones when YHOO hits 30.50.

> > > Microsoft's letter to the Yahoo board

Moving targets

No kidding. Volatile doesn't begin to describe today's session. Hoku Scientific was up more than 10%, then retraced. Google traded down to 510, climbed back up to 529 and is hovering at 525 now. I picked up GOOG at 529, pondered getting more at 512, but was gun-shy. Then I got more at 526.

I emptied out of RIMM and AAPL. No catalyst ahead for either, and RIMM is among the most abused of all high-growth stocks. For short-term trading, there was no point in being in either anymore. I even sold my NTDOY.PK, which seasonally trades down between January and March.

Microsoft's bid to buy Yahoo has kept today's market slightly positive when it probably was going to sell off. Yahoo could hold out for more than $31 per share, but that would be ballsy on their part. Leverage belongs to MSFT. Yahoo opened at 28-plus, came down to 27-plus, and then returned to 28.32. Is Yahoo a good trade here? Seems that it should be.

Intuitive Surgical has kicked arse today on great earnings, and so has Flowserve. Too pricey now, of course. PetroChina and CNOOC and upstanding today with gains of about 5%. Still trading cheap relative to their moving averages.

Goldman Sachs was hovering at 200 before I took a nap (6 a.m. Hawaii time). Now GS is at 207. Boy, talk about what coulda been easy money. China Mobile is up even though Cramer panned it yesterday. Of my Top 25, only six are in negatoid territory: RIMM, AAPL, BIDU, AMZN, MSFT and GOOG. I still hold on to Google. Good chance it can rebound as it did last July after that earnings report disappointed the street. I don't plan to wait two months, though, for a run.