AABA - Altaba Company Profile
Altaba Inc. operates as a non-diversified, closed-end management investment company in the United States. Its assets consist primarily of equity investments, short-term debt investments, and cash. The company was formerly known as Yahoo! Inc. and changed its name to Altaba Inc. in June 2017. Altaba Inc. was founded in 1994 and is based in New York, New York. Company description from FinViz.com.
Altaba owns a 15% stake in Alibaba, currently worth about $70 billion. They hold a stake in Yahoo Japan currently worth $7.7 billion. They have $130 million in investments including Snap Inc. (SNAP). They have a $740 million stake in Excalibur, a unit of the new company that holds all the Yahoo patents that were not sold to Verizon. The company has $12 billion in cash. They recently announced a $5 billion stock buyback and the company has committed to returning nearly all the cash in the bank plus any thrown off by the investments, to the shareholders.
Owning Altaba is just like owning Alibaba only without the expensive options and a lot less volatility. We get the other parts for free.
We have tried to play Alibaba several times but the volatility kept knocking us out. Unless you want to buy a $30 Jan $180 call and just sit on it with no stop loss, AABA is the only way to play Alibaba.
Buy Jan 2019 $70 call, currently $7.50, initial stop loss $61.50.
You could sell short the $90 call for $2.15 but that would limit your gain to $15. Alibaba shares are going to the moon, just like Amazon. They are growing faster than Amazon and have a bigger market with 4.5 billion consumers in Asia.