Yahoo can’t even earn a reward for doing what shareholders wanted.

The company’s plan for a tax-free spinoff of its stake in Alibaba looks logical. But a Reuters Breakingviews calculator suggests that investors are attaching a 34 percent discount to the company’s Alibaba shares – assuming, that is, that Yahoo’s core business is worth something.

The recent spinoff announcement came after years of investor pleas and internal Yahoo debates about how to unwind the $34 billion investment in the Chinese e-commerce giant without taking a tax hit. Yahoo, led Marissa Mayer, finally said it would put the shares into a new investment company, SpinCo, along with its small business division, and distribute SpinCo’s stock to existing Yahoo shareholders.

Run the numbers, though, and Yahoo isn’t getting much credit. Analysts on average expect Ms. Mayer’s remaining businesses to throw off about $1.2 billion of earnings before interest, taxes, depreciation and amortization, or Ebitda, this year, according to Thomson Reuters. Split the difference between the enterprise value-to-Ebitda ratios of AOL and IAC/InterActive, and Yahoo’s core operations are worth $7.8 billion. Add back net cash, and the equity value works out at $13.6 billion.

Yahoo’s other Asian stake, its interest in Yahoo Japan, is worth a bit over $7 billion. As with Alibaba, realizing that could involve a tax hit to the tune of 30 percent or so. That makes the effective value around $5 billion.

The American company’s market capitalization is around $41 billion. That means investors are attributing about $22 billion of worth to the future SpinCo, or more than a third less than the market value of Yahoo’s stake in Alibaba.

It’s to be expected that SpinCo will trade at a discount. For one thing, it will represent only an indirect interest in Alibaba. For another, the new vehicle will still face a tax bill if it ever sells shares in the Chinese firm, so that exposure is only deferred. And of course the spinoff hasn’t happened yet.

But that isn’t enough to explain such a large discount – or even the slightly narrower shortfall that results if Yahoo’s core business is given a more skeptical valuation. Yahoo’s shareholders could win both ways. Either the gap will narrow once SpinCo becomes a reality or, if it persists, Alibaba could eventually be tempted into what amounts to a cheap stock buyback.

Robert Cyran is a columnist for Reuters Breakingviews. For more independent commentary and analysis, visit breakingviews.com.