FOX Translator
No data currently available.
No data currently available.
Whether you're walking a tightrope or scribbling in your checkbook, balance is a good thing. And, one of the best ways to evaluate a company is to glance at its balance sheet to see what it owns with what it owes.
The balance sheet is a paragon of simplicity and is made up of three components: assets (the stuff it owns), liabilities (the money it owes), and shareholders' equity (the company's value to its shareholders).
Assets take two forms: short-term (or current) assets and long-term assets. Under short-term, there¿s good ol' hard cash. Then, there¿s something called "cash equivalents," which are assets like short-term bonds that can be sold so quickly, they might as well be cash. There you factor in inventory, which (if you're a reasonably competent business owner) you can sell to customers in return for--you guessed it--cash. (The raw materials a company owns to make that inventory also falls under this category.)
Long-term assets are things that are harder to convert into cash. (Think real estate and equipment.) Long-term assets depreciate, meaning they lose some value over time. Also under the long-term category are what's called intangible assets: things like patents and brands, that are important, but hard to quantify. Accountants earn their stripes figuring out the real overall value of these assets.
Once you know your assets, it's time for liabilities. As with assets, liabilities are separated into short-term or current, and long-term. Current liabilities are what a company owes in that year: Things like payments to employees or accounts payable to suppliers. Long-term liabilities are debts paid over several years.
Shareholders' equity is determined by subtracting the liabilities from the assets. That number represents the value of the company after all its bills are paid.
Obviously, investors should pay close attention to balance sheets. Spikes in the amount of debt carried, or a reduction in shareholders' equity, are usually red flags.
Home / Markets / Industries / Technology
Sunday, May 04, 2008
Microsoft Pulls Yahoo! Offer
Ken Sweet
FOXBusiness
Microsoft abandoned its plans to purchase Yahoo! on Saturday, after the two technology giants said they could not come to an agreement on price.
According to statements issued by both companies, Microsoft raised its bid at one point to $33 a share, but that still remained $4 a share below the minimum Yahoo! was willing to sell for. The $33 bid represented a 70% premium on the price of Yahoo!'s stock before Microsoft's bid was announced.
"Despite our best efforts, including raising our bid by roughly $5 billion, Yahoo! has not moved toward accepting our offer," Microsoft's Steve Ballmer said in a Microsoft press release. "After careful consideration, we believe the economics demanded by Yahoo! do not make sense for us, and it is in the best interests of Microsoft stockholders, employees and other stakeholders to withdraw our proposal."
With the bid now being off the table, Yahoo!'s stock is poised to fall on Monday. Yahoo! shares closed at $28.67.
The pulled bid comes as a surprising move for Microsoft, who had said previously that it would consider a hostile takeover of Yahoo! (YHOO) through a proxy contest if the company's executives did not approve the merger.
Instead, Microsoft's (MSFT) Steve Ballmer said that a hostile takeover would "would make Yahoo! undesirable as an acquisition for Microsoft."
Without a bid from Microsoft, Yahoo! now must find a way to placate both its employees and more importantly its shareholders.
Most major shareholders have said they were open to a $34-$35 a share price target on Yahoo!, but were fairly confident that Microsoft and Yahoo! could bridge that gap.
But without the bid, shareholders will now turn their anger onto Yahoo!'s Jerry Yang and the company's Board of Directors. There is also the possibility of shareholder lawsuits against Yahoo! for being inflexible during merger talks.
However, while Microsoft has formally pulled its offer off the table, it does not mean that Microsoft is still open for a possible merger.
The Wall Street Journal said on Sunday that Microsoft could be using the rejection letter as a tactic to get shareholders on the company's side and further pressure Yahoo! into a deal, similar to what Oracle (ORCL) did in 2007 with BEA Systems.
Market Snapshot
| Symbol | Last Price | Netchange | Volume |
|---|---|---|---|
| -- | -- | -- | -- |
| -- | -- | -- | -- |
| -- | -- | -- | -- |
| -- | -- | -- | -- |
| -- | -- | -- | -- |
