Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Will Yahoo! Buy OpenTable or Millennial Media?

Shares of OpenTable (Nasdaq: OPEN  ) and Millennial Media (NYSE: MM  ) moved slightly higher yesterday, bucking the general market's downturn after a Reuters article stirred up speculative buzz.

In appealing to Yahoo!'s (Nasdaq: YHOO  ) growing cash hoard, bankers have been approaching the revenue-starved dot-com pioneer with buyout candidates.

A source is telling Reuters that CEO Marissa Mayer appeared to show interest in OpenTable, PubMatic, Turn, and Millennial Media.

PubMatic and Turn aren't publicly traded, but the whiff of buyout potential naturally worked out well for shareholders of OpenTable and Millennial Media.

Online dining reservations leader OpenTable saw its shares climb 6% yesterday on its heaviest volume since early August. Smartphone display advertising specialist Millennial Media treated its investors to a smaller 3% pop.

Both moves make sense.

OpenTable is a growing leader attracting well-to-do foodies. They're obviously not afraid of technology, and bringing that audience closer to Yahoo! should benefit the company's monetization efforts elsewhere. Millennial Media is growing even faster, and it would thrust Yahoo! into a market with familiar heavy hitters. When Millennial Media went public earlier this year, it had recently overtaken Apple (Nasdaq: AAPL  ) to become the second-biggest player in mobile display. Only Google (Nasdaq: GOOG  ) is bigger, largely because of its Android roots. Millennial Media has the advantage of being the only major player of the three to not be operating system-agnostic.

Investors shouldn't chase either of these two companies on the basis of an unnamed Reuters source. However, both companies are dynamic growth stocks.

Perhaps more importantly, Yahoo! will go shopping sooner or later. Yahoo! closed out its latest quarter with a whopping $9.4 billion, and flattish revenue growth is making it clear that the company isn't going to excite investors organically.

Sure, there are taxes to pay after a recent asset sale, and a good chunk of that money is parked overseas. It doesn't matter. Yahoo! has plenty of money to embark on a shopping spree. It would be a surprise if OpenTable and Millennial Media are the companies that Yahoo! ultimately does buy, but they would both be smart moves.

Check, please
The introduction of the iPhone 5 and the iPad Mini are events Apple investors have been looking forward to for months. The stakes are high and the opportunity is huge. By picking up a copy of our premium research report on Apple, you'll learn everything you need to know about the iEverything maker, and receive ongoing guidance as key news hits. Claim your copy today by clicking here now.

Longtime Fool contributor Rick Aristotle Munarriz owns shares of Millennial Media. The Motley Fool owns shares of Apple and Google. Motley Fool newsletter services recommend Apple, Google, OpenTable, and Yahoo!. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Read/Post Comments (3) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On October 24, 2012, at 7:38 AM, appface wrote:

    Mimvi (MIMV) is another buyout candidate that Yahoo could be considering:

    Top 5 Takeover Targets In The Mobile Internet Space

  • Report this Comment On October 24, 2012, at 9:44 AM, Bot1 wrote:

    In your zeal to FOMENT, you forgot one teansy weansy little detail that Marissa Mayer said on the conference call.


  • Report this Comment On October 24, 2012, at 9:49 AM, Bot1 wrote:

    There is no evidence that Marissa said at any time that she would be willing to pay $2 billion for OPEN or MM. That was added by the media.

    Marissa is looking for technology. Does OPEN or MM provide technology that YHOO need? Obviously not.

    However, one has to wonder about the condition of a media who takes a simple statement by a CEO that they are interested in small technology adding companies and blow it into an article such as this.

    "She appeared to show interest" OH, COME ON REALLY! Why not just come out and say that you are trying to influence the price of the stock.

Add your comment.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2071058, ~/Articles/ArticleHandler.aspx, 10/24/2016 6:25:05 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 18,223.03 77.32 0.43%
S&P 500 2,151.33 10.17 0.47%
NASD 5,309.83 52.43 1.00%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

12/31/1969 7:00 PM
MM.DL $0.00 Down +0.00 +0.00%
Millennial Media CAPS Rating: *
OPEN.DL $0.00 Down +0.00 +0.00%
OpenTable CAPS Rating: *
YHOO $42.59 Up +0.42 +1.00%
Yahoo CAPS Rating: **
AAPL $117.65 Up +1.05 +0.90%
Apple CAPS Rating: ****
GOOGL $835.74 Up +11.68 +1.42%
Alphabet (A shares… CAPS Rating: *****