The over-the-counter
price for a single share of Yahoo
Japan Corp. stock this week topped 100 million yen (US$94,780), making it the
first ever to surpass that level in Japanese stock market history.
Following six consecutive days of trading up to its 2 million yen
(US$18,950) daily limit, Yahoo Japan’s share price reached a high of
101.4 million yen (US$96,110) shortly before 10:00 AM on Wednesday.
Japan’s top Internet portal and search service provider could not long
sustain its position above the psychologically important 100 million yen
mark, however. By the close of Wednesday’s trading, Yahoo Japan shares
had fallen back to 99.1 million yen (US$93,930).
By noon Thursday, the share price eroded by an additional 3.7 percent,
trading at 95.4 million yen (US$90,420).
Despite its historic high and subsequent fall, most analysts here
believe that Yahoo Japan’s stock still has considerable upward
potential.
Some market insiders, however, have voiced concern about the steep
upsurge in price (a 10-fold increase in the past year) and cautioned
investors against what they termed “over-heated interest.”
Yahoo Japan currently has fewer than 27,900 outstanding shares, with
only about 15 percent of these actively traded on the market — a
situation that creates wide fluctuations in price even on small
transaction volume.
The company has announced that it will execute a two-for-one stock split
on May 19, a move that Yahoo! Japan Chief Financial Officer Akira
Kajikawa said is aimed at improving liquidity and making the stock more
affordable for individual investors.
Yahoo Japan’s rise has been fueled by strong investor interest in
Internet-related issues, and turbo-charged by the company’s six straight
quarters of record revenues and profit.
On January 14, Yahoo Japan reported a pretax profit for the third
quarter of the current fiscal year (October-December 1999) of 584
million yen (US$5.54 million), a jump of 426 percent from the same
period one year earlier.
This record profit came on total revenues for the quarter of 1.61
billion yen (US$15.3 million), representing a 211 percent year-on-year
increase. Advertising sales accounted for 94 percent of fiscal year
1999’s third quarter revenues.
Site accesses are on an upward trend as well. Yahoo Japan has reported
that December 1999 accesses to its portal site reached 1.23 billion,
nearly triple the December 1998 figure.
Yahoo Japan President and CEO Masahiro Inoue said he expects March
results to surpass those of December. “We’ve always seen the last month
of each quarter doing better than three months earlier,” he said.
Inoue declined, however, to predict whether the company would again post
record revenues and profit in the next quarter.
