Google, Yahoo + MS: share performance
Erick Schonfeld writes in TechCrunch about “Wall Street’s Reaction To The Microsoft-Yahoo Search Deal: Not Good” but he presents only the chart for YHOO.
Any smart investor or analyst would know that it’s much better to analyze all three at once like so:
* spot on the day of search deal announcement, 29 July 2009
* 5 days leading up to 29 July 2009
* 3 month leading up to 29 July 2009 (to take into account the end May-June launch of Bing)
If we have only the YHOO graph as per Schonfeld’s opinion, the deal is under-contextualized. In fact, MSFT shares traded up 1.4 percent whilst GOOG’s fell 0.82 percent against YHOO’s drop of 12.08 percent. Over the 3-month chart we also get a better view of market activity in GOOG shares around early June (please see the blue line on the graph) whilst MSFT’s gained ground.
So that’s another example of why I read tech blogs with a SUBSTANTIAL dose of salt. Their analysis can be incomplete and of an insufficient analytical quality.
It’s how to differentiate journalists from trained corporate strategists, investment analysts and/or investment bankers. Simple things like sourcing data for insights and how the information gets spliced and diced.