Stock For $1 Million A Share?
The word on the street - on the Tokyo street - is Yahoo! Japan.
Its price at one point this week hit $960,000 for one share, and most analysts
expect that it will soon top a cool million dollars. Correspondent Barry Petersen explains.
But before moaning over yet another stock you missed, there isn't much of Yahoo! Japan for sale.
It is mostly owned by a Japanese holding company and the Yahoo! parent company. Only a few thousand shares have ever traded on the open market.
"It's sort of like a bidding war for a very valuable 1964 Dom Perignon champagne," says Toby Rodes, vice president of equity research of Nikko Salomon Smith Barney.
"There aren't a lot of bottles out there. There aren't a lot of shares; there are a of people who want them; the share price goes up," he adds.
Yahoo! Japan's almost million-dollar-a-share status reduces instability. It's not a stock a day trader can easily afford. Among the few lucky individual investors were the first workers at Yahoo! Japan who received stock options.
When the stock went on sale in November 1997, it was already a whopping $15,000 a share. Today a couple of stock splits later, every share is now four shares. Every single shareholder in Yahoo! Japan is now a multimillionaire.
At a million dollars, is it time to take profits and run? Rodes says he thinks that would be a big mistake because he thinks it is going to go higher.
Right behind Yahoo! Japan, another Japanese Internet stock heading for a million a share is Internet Research Institute. It closed today at only $716,000 a share. In Japan these days, that's almost a bargain.