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Quote of the Day
“I believe that investors need to remember the investment basics and not allow the ease and speed with which they can trade to lull them either into a false sense of security or encourage them to trade too quickly or too often.”
-SEC Chairman Arthur Levitt, said on this day in 1999 as the tech bubble rages on.
January 27th – This Day in Stock Market History
1999 – Yahoo buys Geocities for $3.6 billion. Geocities shareholders receive 0.3384 shares of Yahoo for each share of GeoCities they own.
New York Times coverage of Yahoo’s purchase of Geocities.
On this day Yahoo shares closed at $335.875 ($83.97 in today’s prices after adjusting for 2 separate 2:1 share splits), already down significantly from its all time high of $500.13 (125.03 adjusted) on January 2nd.
GeoCities market cap was $2.3 billion prior to the announcement of the deal.
Coincidentally on this day, GeoCities would announce 4th quarter revenue of $7.5 million, with a net loss of $8.4 million, or 27 cents per share for the quarter, and a $19.8 million loss for the year on $18.4 million in revenue. But all that mattered was traffic, at the time GeoCities was the third most visited website.
Today, Yahoo shares no longer trade under its old ticker symbol of YHOO. Most of the business was sold to Verizon (VZ), Yahoo Japan trades under the ticker YAHOF, and Yahoo’s stake in Alibaba (Known as ‘Altaba’) trades under the ticker AABA.
Best January 27th in Dow Jones Industrial Average History
1975 – Up 3.91%, 26.05 points.
Worst January 27th in Dow Jones Industrial Average History
1932 – Down 2.43%, 1.94 points.
Read of the Day
The late 90’s and early 2000s was an environment that will likely never be repeated. Stocks rose hundreds of percent in a single day, simply adding “dot com” to your company name would boost the stock price!
Yahoo was one of the darlings of the tech bubble, but it was also one of the few that survived. Although shares would never come close to their tech bubble highs, Yahoo investors fared better than many dot com “investors”.
Here is a fun list from CNN Money of the biggest dot com busts
A sneak peak:
<– Go To Previous Day: January 26th: 1989 – AT&T Reports its first loss in 103 years
Go To Next Day: January 28th: 1965 – Dow hits 900 for first time. 1986 – Challenger explosion. –>
