25 July 2016: Verizon buys Yahoo's core for $4.8 billion
Verizon agreed to buy Yahoo's core internet business for about $4.8 billion. At the height of the dot-com boom, Yahoo had been worth more than $100 billion and had famously passed on chances to buy Google and to sell itself to Microsoft for far more. By 2016 most of Yahoo's remaining value sat in its Alibaba stake. It was a long, slow lesson in how quickly internet leadership can evaporate.
The lesson: Being first and famous on the internet guarantees nothing; durable advantages matter more than early fame.
What it meant for investors
$1,000 in Yahoo at the start of 2018 → $1,000 today, vs $2,519 in the S&P 500.
We start the clock at the start of 2018, the first year in our price data after the event. That is 1.0 times the money, but $1,519 less than a plain index fund made over the same years.
What Yahoo teaches: Sometimes a company's best asset is a passive investment; for years the market valued Yahoo's core business at roughly zero once its Alibaba stake was counted.
| Bought in | Price then | Worth today | S&P 500 would be |
|---|---|---|---|
| 2015 | $50.00 | $1,040 | $3,301 |
| 2018 | $52.00 | $1,000 | $2,519 |
| 2020 | $52.00 | $1,000 | $2,092 |
green = beat the S&P 500 · red = lost money
What if you bought Yahoo? Every starting year and the full story →
More Yahoo history
- 1 February 2008: Microsoft bids $44.6 billion for Yahoo
- 12 April 1996: Yahoo goes public and more than doubles
Could you have called it at the time? The wheel picks the year, you pick the position, ten seconds a pick.
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