Analysts: Microsoft can buy Yahoo without raising bid
Microsoft's offer to buy Yahoo will likely succeed, but it may not be the best use of the company's ample cash reserves, according to a poll of analysts by Reuters.
The stand-off between Microsoft and Yahoo has stretched six weeks since the world's largest software maker went public with its proposal. The Web pioneer subsequently rejected Microsoft's offer, which currently values Yahoo at $41.4 billion, saying the takeover bid "substantially undervalued" the company.
The Reuters poll finds Wall Street brokers who follow either company remain convinced that Microsoft will prevail in its takeover. Eight of eight Microsoft analysts surveyed and 14 of 15 Yahoo analysts believe Microsoft will get the deal done.
"Yahoo's options are becoming more limited and it makes Microsoft's offer look better," said Andy Miedler, an analyst at Edward Jones, who has a "hold" rating on Microsoft.
Twenty-one brokerages responded. Seven brokers have analysts who follow both companies and their votes were counted separately. In total, 33 financial analysts currently follow Yahoo and 40 analysts track Microsoft.
via USA Today