GOOGLE rules the world!!! Ka-chingo for GOOGLE!' Whateva. ALMOST (ah, like hindsight, always 20/20!) called the $450 GOOG options straddle. Ah, the ones that get away!!! No biggie, though, only a triple plus. I really had zero opinion on GOOG #s. If you put a gun to my head I'd have said long, just cause right now everything going up even when they miss on the notion that we're at a bottom. Maybe, maybe, though I don't buy it. But, meanwhile we got nice big option moves on GS, MA, CMP, MELI and such. VERY nice, Waxie LOVE Options Expiration week! Only regret was selling a bit too soon cause GOOG looks to carry us higher into tomorrows close it appears. I've been saying we could get to a new High of Year shortly and we just may. The joy of trading is you can be bearish and yet still make money from the long side on a day to day basis! Or, even a week to week basis. So, how can YOU profit from GOOG without owning it? Well, I'm going to post some commentary now for you guys. This is the type of stuff we do for our clients day in and day out. We have been KICKING butt and we are going to be offering a FREE TRIAL for ya shortly so you can see for yourself why we are THE BEST, period! I would buy YHOO here. I'm not going to go into it for the hour I usually would, but I'll give you the basics and you can make your own decisions. I think YHOO is a pretty nice long play here, I think its only real downside appears to be if MSFT backs off its offer. I do not see that happening. It could, but I think its unlikely and GOOG is the reason. Here goes;YHOO and GOOG are forming a partnership to fend off MSFT offer of $31 a share for YHOO,which YHOO rejected out of hand. I'm sure you know this.
With GOOG #s today it reaffirms jerry yang's contention that MSFT offered way too little for YHOO at $31 a share.
MSFT when they made the offer got HAMMERED, destroyed and MSFT shareholders have been up in arms.
GOOG's #s does several things -
#1)Reinforces the bull case on online advertising
#2)Justifies MSFT offer for YHOO for both itself and it's shareholders, and the need for MSFT to do something or be crushed in the online ad arena. Also, you probably know this, but GOOG is releasing several initiatives that will directly compete with MSFT, including by all indications its own computer platform to compete with Windows.
There's more, but I have to leave, so suffice to say I think there is zero chance now #1 - the deal gets done between YHOO and MSFT
#2 - it gets done at a minimum of $35 a share in cash
There is just no chance that MSFT can not afford NOT to do the YHOO deal. GOOG literally is putting MSFT long term prospects at risk if they don't in my opinion.
There are several ways to play this, but the "safest" would be to buy YHOO shares and then hedge with the $25 puts, or the $20s if you want to have more share risk. The only question is when a deal gets done.
GOOG is $527 a share after hours. They will potentially go to $550 by tomorrow. I wish I bought some calls, but obviously didn't. Regardless, I think there is a very good opportunity on YHOO here long.
Further still, YHOO reports earnings next week I believe. There is virtually ZERO shot they do not blow out. ZERO. yang is not going to miss, that's absurd. They should blow out, further justifying a deal to MSFT, MSFT shareholders.
MSFT shares should also get a near term lift. I would be a buyer tomorrow at the open depending on where it opens for the same reasons. The stock sold off about 12% since they made the YHOO play.
Also, MSFT had admitted offering YHOO $40 a share in Dec. So, I think it is possible that the # is closer to $40 than $35. I think YHOO is a good buy here for the reasons stated above. We'll see soon enough, but I think if you play it right you should make a nice score without too much risk. See ya tomorrow, folks, see ya tomorro! RULE!