QUOTE AND NEWS
Benzinga  Aug 30  Comment 
On CNBC's Fast Money Halftime Report Final Trade, Jim Lebenthal said that he is a buyer of Target (NYSE: TGT) because the retail is picking up and the stock is cheap. Pete Najarian likes Yahoo (NASDAQ: YHOO). With Alibaba IPO coming, the stock...
Yahoo  Aug 29  Comment 
This weekend marks the unofficial end of summer, which means the warm, lazy days of August are over (though the S&P crossing 2,000 and economic growth of 4.2% hardly warrant the use of ‘lazy’). It’s time to breathe some fresh autumn air into...
SeekingAlpha  Aug 29  Comment 
By Zacks Investment Research: Yahoo! Inc. (NASDAQ:YHOO) has seen its shares lag in 2014 as investors await the Alibaba (Pending:BABA) IPO. This Zacks #5 Rank (Strong Sell), however, is struggling to grow earnings with negative growth expected this...
Jutia Group  Aug 29  Comment 
[at CNBC] - Thanks to the Alibaba IPO, Yahoo is about to have a lot of cash on hand. Will it be enough to drive changes that can turn around its core business? Read more on this. Yahoo! Inc. (YHOO), with a current value of $38.22B, began trading...
Benzinga  Aug 28  Comment 
Alibaba is slated to IPO in September on a rumored date of the 16. Ahead of the IPO, MKM Partners, which is not participating in the IPO nor initiating coverage, released a list of observations surround Alibaba’s business metrics. On August...
Cloud Computing  Aug 28  Comment 
Yahoo CIO Mike Kail will present a session on DevOps at the 3rd International DevOps Summit, November 4-6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. Mike brings more than 23 years of IT operations experience with a focus on...
Cloud Computing  Aug 28  Comment 
CHICAGO , Aug. 28, 2014 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks...
TheStreet.com  Aug 28  Comment 
Story updated at 9:50 a.m. to reflect market activity. NEW YORK (TheStreet) --aBank of America-Merrill Lynch raised its price target for Yahoo! to $40 from $39 Thursday, reiterating its "buy" rating. Shares of Yahoo fell -0.5% to $37.98 in...
SeekingAlpha  Aug 28  Comment 
By Douglas Ehrman: With Alibaba expected to complete its IPO as early as next month, the announcement that it grew quarterly revenues by an impressive 46% is a big positive for anyone lucky enough to get a share allocation. But as a 22.5% owner of...
Benzinga  Aug 27  Comment 
In a F1 filing Wednesday, Alibaba (BABA) showed net income tripling to $1.99 billion, or $0.84 a share for the second quarter. Revenue rose just shy of 45 percent $2.15 billion, due in large part to a jump in advertising spending on the...




 

Yahoo! Inc. (Nasdaq: YHOO) is a global internet services company that operates the Yahoo! Internet portal. It provides varied products and content, from email and search to media streaming and downloads. Its main revenue sources come from advertising and marketing services. In fiscal year 2010, Yahoo reported revenues of $6.3 billion and net income of $1.2 billion. While Yahoo's main presence is in the United States, its well-established name and solid partnerships in Asia make international expansion a promising opportunity for the company. In response to the fast growing mobile advertising market, Yahoo has been actively pursuing partnerships with carriers and original equipment manufacturers in the mobile industry, as well as tailoring their existing marketing services to mobile users.

Company Overview

Founded as a web directory by two Stanford graduates in 1994, Yahoo! had become a dominant player in the field of Internet services although its competitive position has since become eclipsed by Google and others. The company had experienced healthy growth in top-line revenue year over year for the last four years, but net income has fallen year-over-year due to increased costs of doing business in the increasingly competitive sphere of internet advertising. Specifically, Yahoo!'s year over year cost of revenue is increasing faster than their revenue growth.

Trends and Forces

Increase in Online Advertising

Advertising spending continues to show a disproportionate skew in favor of newspaper, TV and direct mail. However, the Internet channel has grown at approximately 18% per year--faster than any other channel--taking share from stagnant channels such as newspaper, which has been flat over the same time period. Continued growth in quality and availability of Internet access means that the Internet services sector--particularly Internet advertising--will remain lucrative for some time to come. An increasingly pronounced trend of replacing print directories and classifieds with virtual alternatives will also create a push for online search use as well as increase demand for online classifieds.

Online Video Advertising Growth

Video advertising promises to be a particularly lucrative area of rapid growth in the online advertising sector as online video viewership continues to rise. In research released by comScore, data shows that 175 million U.S. Internet users watched online video content in October for an average of 15.1 hours per viewer.[1]. In terms of video property and viewership, Yahoo ranked second with 53.8 million viewers, behind Google Sites's 146.3 million unique viewers and ahead of Viacom Digital, VEVO, and Facebook[1].

  • Branded vs. Search Advertising

Branded advertising is often image-based and usually priced on an "impressions" basis--the more times it shows up, the more the advertiser pays. Search advertisements are primarily text-based and usually rely on click-through; the more times a particular link is clicked, the more Yahoo! is paid. Together, the two constitute a good balance of different kinds of online advertising. However, branded advertising tends to depend very heavily on the economic situation of the brands in question.

  • Mobile Advertising

Mobile advertising is in its nascent stages and is currently growing at more than 20% per year, making it a powerful source of potential growth for Yahoo! On its end, the company has been actively pursuing partnerships with carriers and original equipment manufacturers in the mobile industry, as well as tailoring their existing marketing services to mobile users.[2]

Competition

  • Google is Yahoo!'s biggest competitor in search advertising. Google's acquisition of popular video site YouTube put it directly against Yahoo! in media streaming, and the two already have a long-standing rivalry over search-based online advertising. Yahoo! has lost significant search market share to Google. In 2009, Google made headlines by overtaking Yahoo! in unique users per month. However, Yahoo! recently released a next-generation online advertising platform system called Panama. Their system will in theory optimize advertising profits by increasing the average revenue per search click and has returned modestly successful results so far. Yahoo!'s recent acquisitions of RightMedia and BlueLithium further solidifies its position in display advertising. Finally, Yahoo!'s perceived role as a community-based entertainment site may also give it a slight edge over Google in entertainment-based advertising. However, Google's MySpace-YouTube advertising alliance may be poised to challenge the company.
  • Microsoft, with the introduction of Windows Live and adCenter, Microsoft is also a growing threat. Microsoft's acquisition of LiveJournal gives it a significant foothold in the webblog scene, and along with Google, it has been steadily gaining ground against Yahoo! in the European Internet services market. However, by itself Microsoft remains less a threat than Google.
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