Speaking to Benzinga, TD Ameritrade's Chief Strategist JJ Kinahan commented on Yahoo's proposed tax-free spin of Alibaba, noting that the situation is "very complex." Appropriately, the stock is trading not far removed from its 52-week low of $29.00.
Kinahan continued that any time a company is involved in a complex situation that requires the use of many lawyers and experts, it makes the company "less desirable" given the uncertainty over the final outcome while simultaneously forcing management to allocate focus, talent and capital away from running the core business.
With confidence in the stock and business outlook already low, Kinahan pointed out that Yahoo's management is now forced to focus away from "where they should be focusing."
No Update From Twitter
Speaking of management, Twitter was highly rumored to come out of the long weekend with a much anticipated update to its CEO search. Kinahan stated that the company hasn't exactly utilized a "textbook" approach to its CEO search.
Kinahan further pointed out that Twitter's stock is now trading off its IPO price, implying the Street is screaming the company could have "handled things better."
"When you don't do what's expected, it's usually not a great sign," Kinahan concluded.
Image Credit: Public Domain© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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