Ask Matt: Should I buy Yahoo now?

Q: Should I buy Yahoo before a spin-off?

A: Yahoo (YHOO) is one those companies that should be worth more. That's why investors are pressuring the company to unlock value.

The fact Yahoo is only worth $32.9 billion is astounding if you consider it owns 15% of Chinese e-commerce site Alibaba (BABA). Yahoo's stake in Alibaba alone is valued at $32.5 billion. To help unlock the value of the underlying business - the Internet portal - Yahoo is considering a plan to spin-off its core business. It might be tempting to pile into shares of this company - as investors seem to be making headway to pressure management to make changes to boost market value. There is a case to be made that Yahoo's underlying business could be worth something if structured properly. The average analyst thinks Yahoo shares could be worth $42.51 a share in 18 months. If correct, that would be 24% upside from Wednesday's closing price of $34.40. Speculators might go for it, but there's not much reason for investors to buy this stock. The key metrics that matter to investors, including net income, return on capital and return on equity, have all been falling preciptiously over the past three years and analysts expect just 3.4% long-term growth. The spin-off isn't a guarantee, either.

Paste BN markets reporter Matt Krantz answers a different reader question every weekday. To submit a question, e-mail Matt at mkrantz@usatoday.com or on Twitter @mattkrantz.