Yahoo stock rises as it turns Alibaba investment into separate company

Was the Alibaba making Yahoo sluggish or bearish? Keep an eye …

Gigaom

Yahoo is splitting its remaining Alibaba shares into a separate company called SpinCo. The move will help Yahoo avoid the tax pitfalls of the investment.

The news came Tuesday as Yahoo reported its fourth quarter earnings. In after hours trading Yahoo’s stock price increased as much as seven percent. Investors clearly approve of the plan for the cash.

The presentation deck for the plan explained that part of the goal of spinning off the Alibaba investment is to provide transparency for investors into Yahoo’s core business. SpinCo will still be answerable to Yahoo shareholders. Take a look at the full deck here. This image visualizes the split:

Page 4 from the Yahoo deck on its Alibaba investment split off Page 4 from the Yahoo deck on its Alibaba investment split off

In terms of its fourth quarter earnings, Yahoo met expectations. Here’s the numbers:

Revenue:

Analysts expected — $1.19 billion

Yahoo actual — $1.18 billion

Earnings per share:

Analysts expected

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