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Comment by davidiach | Hacker News Reader

It is only me or is this a really good time to buy tech companies? We had so many acquisitions lately some of which don't even make that much sense apart from the low price they where bought for.

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In German industry, there's plenty of angst that incumbents might be displaced by IT companies. E.g. Apple introduced their watch a bit more than a year ago and now they're dominating the smartwatch market, traditional swiss watchmakers can hardly get a foot in this space. So companies are trying to buy whatever they can afford in the hope of not ending up left behind. Porsche recently bought a stake in a parking app startup [1]. It all feels a bit like the dotcom era when so-called "old economy" companies frantically shelled out money to acquire "new economy" startups. Or like the stage shortly before the credit crunch in 2007 when dumb German Landesbanks piled subprime papers onto their balance sheet [2].

[1] http://www.intelligentmobilityinsight.com/news/ClB/Porsche-t...

[2] http://archive.fortune.com/magazines/fortune/fortune_archive...

To be fair, Swiss watchmakers have a long tradition of sticking their head in the sand when innovation happens. cough Quartz.

It's not just you. That's why there have been so much M&A.

Interests rates are low so getting loans to buy out your competition. In a time when VC money has (relatively) dried up and growth in many industries has slowed your competition are increasingly desperate to keep the lights on. A good few companies are pretty primed to sell right now.

> apart from the low price they where bought for

It's not low for German (I'd even argue: for European) standards.

Last year they had $666.9M in revenue and $73.61M in profits.[1] I would say it is pretty low.

[1] https://finance.yahoo.com/quote/MWW/financials?p=MWW

Their multiple is probably low because it looks like the business is shrinking: $764m in 2013, $726m in 2014, and $667m in 2015. I might be overgeneralizing, but it even looks like revenue is shrinking at an accelerating pace.

> I might be overgeneralizing, but it even looks like revenue is shrinking at an accelerating pace.

German here; they have ads everywhere; maybe they just spend too much at the moment.

>they have ads everywhere; maybe they just spend too much at the moment.

But the parent commenter was worrying about shrinking revenue, not profit. If anything, an overly aggressive advertising campaign should grow revenue while shrinking profit.

Revenue it's not profit, and it's something that should be almost always positively correlated with advertising.

I don't know what Yahoo is smoking. Their FY15 statements say that GAAP net income was $13.2 million on $666m of revenue. 2014 had $725m of revenue with a loss of $293m. This is a company that is slashing and burning.

It's a good time to buy anything. Low interest rates across the board mean you can leverage cheap loans.

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