Share This Article

Facebook LinkedIn
Twitter Reddit
Print Email
Pinterest Gmail
Yahoo
Money Morning
×
  • Invest
    • Best Stocks to Buy
    • Stock Forecasts
    • Stocks to Sell Now
    • Stock Market Predictions
    • Technology Stocks
    • Best REITs to Buy Now
    • IPO Stocks
    • Penny Stocks
    • Dividend Stocks
    • Cryptocurrencies
    • Cannabis Investing
    • AI Investing
  • Trade
    • How to Trade Options
    • Best Trades to Make Now
    • Options Trading Strategies
    • Weekly Trade Recommendations
  • Retire
    • Income Investing Guide
    • Retirement Articles
  • More
    • Money Morning LIVE
    • Special Investing Reports
    • Our ELetters
    • Our Premium Services
    • Videos
    • Meet Our Experts
    • Profit Academy
    • Postcards
Login Archives Your Team About Us FAQ
  • Invest
    • Best Stocks to Buy
    • Stock Forecasts
    • Stocks to Sell Now
    • Stock Market Predictions
    • Technology Stocks
    • Best REITs to Buy Now
    • IPO Stocks
    • Penny Stocks
    • Dividend Stocks
    • Cryptocurrencies
    • Cannabis Investing
    • AI Investing
    ×
  • Trade
    • How to Trade Options
    • Best Trades to Make Now
    • Options Trading Strategies
    • Weekly Trade Recommendations
    ×
  • Retire
    • Income Investing Guide
    • Retirement Articles
    ×
  • More
    • Money Morning LIVE
    • Special Investing Reports
    • Our ELetters
    • Our Premium Services
    • Videos
    • Meet Our Experts
    • Profit Academy
    • Postcards
    ×
  • Subscribe
Enter stock ticker or keyword
×
Join 100,000+ Like-Minded Investors Today
Twitter
Tags: Hot Stocks

Will Yahoo Stock (Nasdaq: YHOO) Keep Climbing?

By Diane Alter, Contributing Writer, Money Morning • July 17, 2013

View Comments

Start the conversation

Leave a Reply Click here to cancel reply.

You must be logged in to post a comment.

Yahoo stock has soared nearly 90% in the past year, and CEO Marissa Mayer deserves much of the credit.

Yahoo! Inc. (Nasdaq: YHOO) was seriously ailing when Mayer came on board a year ago. Many analysts placed Yahoo stock on "death watch" and readied to send it to Internet stock graveyard.

Mayer has undeniably made progress as she finishes her first year at the helm.

"She's done a great job," Money Morning Capital Wave Strategist Shah Gilani told FOX's Stuart Varney on Tuesday. "She's done a terrific PR job for the stock."

The question for investors: With shares up more than 70% in Mayer's first year - and another 10.38% today to $29.67 - is there still time to profit from Mayer's success, or did they miss the boat on Yahoo stock?

Yahoo Stock: Still a Buy with Weak Earnings?

Despite Mayer's hard work, Gilani thinks the explosive Yahoo stock gains could be nearing an end.

 



"I think it's fairly fully priced," Gilani told Varney. "[Mayer's] done a great job, but company-wise, I'm not really impressed."

While numbers released yesterday (Tuesday) showed earnings rose 46%, revenue slid 7% from a year ago, a problem that continues to plague the company despite some hints of improvement.

Yahoo earned $331 million, or $0.30 per share, in the three months ending in June. That compares to $227 million, or $0.18, in the same period a year earlier. Revenue totaled $1.14 billion, down from $1.22 billion.

But the news wasn't all bad for Mayer...

Displaying her prowess as CEO, Mayer successfully overhauled many of Yahoo's core products, like online photo sharing management and smartphone app Flickr.

She got rid of some 30 products Yahoo visitors weren't using, and acquired 17 companies during her first year. Those included Summly, an app that condenses content for smartphones, for $30 million, and Tumblr, an increasingly popular blog site. Many balked at the whopping $1.1 billion Tumblr price tag, but the deal got people taking again about Yahoo.

Talking of Tumblr, Mayer said, "Since the deal, Tumblr's growth has seen an acceleration, with almost a quarter of a million new blogs being set up each day."

However, that growth isn't adding revenue, and won't for a while - Mayer admitted that Tumblr won't provide "meaningful revenue" this year.

Additionally, Yahoo trimmed its full year revenue guidance to $4.45-$4.55 billion, from $4.5-$4.6 billion.

This is part of the reason Gilani isn't impressed with buying Yahoo stock now.

"Seventeen acquisitions and none of them really are making money. The time to integrate those into the 'greater Yahoo!' will be lengthy," said Gilani. "And their ad sales are slipping - slipped 11% in the first quarter."

There is one reason Gilani would consider owning Yahoo stock...

Alibaba, the Chinese e-commerce company in which Yahoo owns a 24% stake,, is rumored to be going public. Gilani told Varney that rumors this week hinted that Goldman and Credit Suisse could be bringing it out, and that would give investors a nice pop.

Alibaba nearly tripled its net income in the first three months of the year and increased revenue by 71%.

Alibaba's strong performance helped drive Yahoo stock's gains today to a five-year high.

But until Yahoo starts making money on what it has spent, there's no other reason to buy.

Yahoo (Nasdaq: YHOO) Gets Hit By Competition

The uninspiring revenue growth reflects Yahoo's struggles selling more digital advertising even as marketers increase their spending at rival sites like Google Inc. (Nasdaq: GOOG) and Facebook Inc. (Nasdaq: FB). Moreover, plenty of the spending is in mobile, an area where Yahoo is sorely lacking presence.

Indeed, Google grabbed half of all mobile ad revenue in 2012. The Internet search giant collected $4.61 billion in mobile ad revenue worldwide last year, more than half the $8.8 billion ad market, and almost a third of all digital ad spending in 2012, according to eMarketer.

This year, Google's share is projected to rise to 56% from 52%, hitting $8.84 billion.

Facebook took the second-largest shares of mobile ad dollars last year with $470 million. This year, the social network leader's ad revenue is expected to climb 334% to $2.04 billion.

Meanwhile, Yahoo's ad display revenue in Q2 came in at $423 million, an 11% decrease.

While Yahoo stock isn't a good "Buy" right now, this other tech powerhouse is: The Only Tech Stock You'll Ever Need

Related Articles:

  • Business Insider:
    Yahoo Earnings for Q2 2013
  • Forbes:
    Yahoo Earnings: Marissa Mayer Is Not Ready For Her Close Up
  • USA Today:
    Tech stocks: What to Watch from Yahoo earnings:

Here Are 10 “One-Click” Ways to Earn 10% or Better on Your Money Every Quarter

Appreciation is great, but it’s possible to get even more out of the shares you own. A lot more: you can easily beat inflation and collect regular income to spare. There are no complicated trades to put on, no high-level options clearances necessary. In fact, you can do this with a couple of mouse clicks – passive income redefined. Click here for the report…

Claim My Free Report

Subscribe
Login
Notify of
guest

guest

1 Comment
Oldest
Newest Most Voted
Inline Feedbacks
View all comments
PRADIP S.
PRADIP S.
10 years ago

Mayer was 'brought in' a year ago to collude with Wall Street's pump and dump scheme. CNN and FOX are all part of the collusion and play the 'pump' scheme. Not a single YHOO employee or user thinks that the company has improved any since the arrival of Mayer. This Wall Street cabal that dupes innocent investors of their life-long savings must end now!

0
Reply


Latest News

September 20, 2023 • By Garrett Baldwin

Postcards: Captured by Vines... and Regulation

September 20, 2023 • By Tom Gentile

How to Cash In On The Most Perfectly-Timed Selloff in History

September 18, 2023 • By Garrett Baldwin

Dogs That Are Fluent in Spanish for $200, Alex.
Trending Stories
ABOUT MONEY MORNING

Money Morning gives you access to a team of market experts with more than 250 years of combined investing experience – for free. Our experts – who have appeared on FOXBusiness, CNBC, NPR, and BloombergTV – deliver daily investing tips and stock picks, provide analysis with actions to take, and answer your biggest market questions. Our goal is to help our millions of e-newsletter subscribers and Moneymorning.com visitors become smarter, more confident investors.

QUICK LINKS
About Us COVID-19 Announcements How Money Morning Works FAQs Contact Us Search Article Archive Forgot Username/Password Archives Profit Academy Research Your Team Videos Text Messaging Terms of Use
FREE NEWSLETTERS
Total Wealth Research Power Profit Trades Penny Hawk Midday Momentum
PREMIUM SERVICES
Money Map Press Home Money Map Report Fast Fortune Club Weekly Cash Clock Microcurrency Trader Hyperdrive Portfolio Rocket Wealth Initiative Quantum Data Profits Flashpoint Trader Darknet Alpha Accelerators Brutus Alerts Resource Traders Alliance L.A.U.N.C.H. Investor Rob Roy Trader Long-Term Equity Profits

© 2023 Money Morning All Rights Reserved. Protected by copyright of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including the world wide web), of content from this webpage, in whole or in part, is strictly prohibited without the express written permission of Money Morning.

Address: 1125 N Charles St. | Baltimore, MD, 21201 | USA | Phone: 888.384.8339 | Disclaimer | Sitemap | Privacy Policy | Whitelist Us | Do Not Sell or Share My Personal Information

wpDiscuz