SunTrust Sees Yahoo!'s (YHOO) Board Pausing Ahead of Spin/Sell Decision (BABA)

SunTrust Robinson Humphrey affirms Yahoo! (Nasdaq: YHOO) with a Buy rating and $40 price target amid the company's decision to spin its core Internet business.

Analyst Robert Peck believes Yahoo!'s board is wrapping up meetings and will come to a decision on the matter soon.

Peck also thinks that a pause is the likely decision for several reasons:

1. we believe investors are expressing their concerns about the potential tax liability and would prefer the company to assess ALL options;
2. we believe there would be many suitors for Yahoo's core asset including multiple PE firms and strategics like AT&T (NYSE: T), $33.10, NR), Verizon ((NYSE: VZ), $44.56, NR), Disney ((NYSE: DIS), $111.89, NR), NewsCorp ((Nasdaq: NWSA), $13.78, NR), and Comcast ((Nasdaq: CMCSA), $59.62, Neutral);
3. we believe that Aabaco could trade at a significant discount to NAV due to tax concerns; and
4. per the WSJ article, Alibaba ((NYSE: BABA), $82.59, Buy) may be interested in YHOO post a core spin, but not as interested in shares of Aabaco.

For an analyst ratings summary and ratings history on Yahoo! click here. For more ratings news on Yahoo! click here.

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