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October 18, 2006

Maybe Microsoft Will Buy Mamma.com

posted by MR WAVETHEORY at 10/18/2006 07:25:00 AM

Microsoft Corporation (Nasdaq MSFT) is getting ready to launch Vista and I've pointed out how slow Windows Desktop search is. In a test I did, Windows took 10 times longer to find notepad.exe than Google Desktop Search (Nasdaq GOOG). Unbelievable isn't it? That is why I believe Mamma.com Inc. (Nasdaq MAMA) could be bought by Microsoft. Mamma has Copernic Desktop Search and it's the highest rated desktop search application on CNET Networks Inc. (Nasdaq CNET) and also bundled with AOL.

Imagine what buying Mamma would do for Microsoft? It would pull the rug out from under AOL Time Warner Inc. (NYSE TWX) at the same time that it gives Microsoft the best desktop search application out there. I think Mamma is a buy at $1.59 and could be worth $8 on a buyout.

Note my analysis is very top down. I think these are the scenarios.

25% @ $8 Buyout from Microsoft
50% @ $5 Improvement in earnings and revenues from AOL
25% @ $3 Stand alone company

I think this Mamma.com stock is worth $5.25.

Other News: Microsoft launches Linkfromdomain search.

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