Analysts: Yahoo (YHOO) to Lose Display Revenue Going Forward
Tweet
Share
E-mail
Get Alerts YHOO Hot Sheet
Price: $52.58 --0%
Rating Summary:
18 Buy, 21 Hold, 5 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 4 | Down: 8 | New: 54
Rating Summary:
18 Buy, 21 Hold, 5 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 4 | Down: 8 | New: 54
Join SI Premium – FREE
Shares of Yahoo Inc. (NASDAQ: YHOO) are down 2.84 percent to $15.56 in midday market movement on Wednesday following the company's fourth-quarter results.
The Internet company reported fourth-quarter earnings on Tuesday of 26 cents per share, 4 cents better than the analyst estimate of 22 cents per share.
Revenue for Yahoo fell 4 percent to $1.2 billion ex-TAC from $1.26 billion in the same quarter last year, but beat the Streets view of $1.17 billion.
The company said that operating margin in the period jumped from 7 percent last year to 14 percent. The company's search revenue fell 27 percent in the period to $640 million, while display revenue increased 14 percent to $635 million.
Looking forward, the company sees first-quarter ex-TAC sales in the range of $1.02-$1.08 billion, missing the consensus of $1.14 billion.
Analyst comments:
Benchmark maintains a Hold rating on Yahoo with a $16 price target on the stock.
Benchmark analyst says, "Yahoo’s turn-around is not yet evident. This may encourage CEO Carol Bartz to more actively explore liquidating the value of Yahoo’s Alibaba investment. Earnings in equity interests grew 57% y/y to $108 million, reflecting improvements in Yahoo’s Asian assets. Bartz sees Alibaba as a great investment and indicated Yahoo would consider liquidating Yahoo Japan, if tax efficient. An IPO of Taobao could potentially unlock value."
Wedbush maintains an Underperform rating on Yahoo with a price target on the stock of $15.50, noting that the weak Q1 guidance will be an overhang.
Wedbush analyst says, "Search advertisers have been broadly disappointed with the combined platform to date, and it’s reflected in the results. A 6% revenue drop in search revenue is a reflection of market share loss and poor RPS. While the alliance rights the ship, Google continues to pull ahead."
Deutsche Bank maintains a Hold rating of with a price target of $14, as the firm sees issues with display revenue ahead.
Deutsche Bank analyst says, "We feel 2011 represents another tough year of revenue declines as Google (NASDAQ: GOOG) impacts paid search and Facebook waits in the wings to impact Yahoo!'s display ad business. We think growth may resume in 4Q at the earliest, although we believe that Yahoo! must lower its monetization and re-invest in products."
Goldman Sachs maintains a Neutral rating on Yahoo with 6-month price target of $18.
Goldman Sachs analyst says, "We believe Yahoo! holders will take solace from the company’s stated desire to sell part of its 34% stake in Yahoo! Japan, if it can find a single buyer and a tax-efficient exit strategy. However Yahoo!’s display revenue is already at risk of falling behind its 2010-2013 growth target of 13%-16% yoy."
The Internet company reported fourth-quarter earnings on Tuesday of 26 cents per share, 4 cents better than the analyst estimate of 22 cents per share.
Revenue for Yahoo fell 4 percent to $1.2 billion ex-TAC from $1.26 billion in the same quarter last year, but beat the Streets view of $1.17 billion.
The company said that operating margin in the period jumped from 7 percent last year to 14 percent. The company's search revenue fell 27 percent in the period to $640 million, while display revenue increased 14 percent to $635 million.
Looking forward, the company sees first-quarter ex-TAC sales in the range of $1.02-$1.08 billion, missing the consensus of $1.14 billion.
Analyst comments:
Benchmark maintains a Hold rating on Yahoo with a $16 price target on the stock.
Benchmark analyst says, "Yahoo’s turn-around is not yet evident. This may encourage CEO Carol Bartz to more actively explore liquidating the value of Yahoo’s Alibaba investment. Earnings in equity interests grew 57% y/y to $108 million, reflecting improvements in Yahoo’s Asian assets. Bartz sees Alibaba as a great investment and indicated Yahoo would consider liquidating Yahoo Japan, if tax efficient. An IPO of Taobao could potentially unlock value."
Wedbush maintains an Underperform rating on Yahoo with a price target on the stock of $15.50, noting that the weak Q1 guidance will be an overhang.
Wedbush analyst says, "Search advertisers have been broadly disappointed with the combined platform to date, and it’s reflected in the results. A 6% revenue drop in search revenue is a reflection of market share loss and poor RPS. While the alliance rights the ship, Google continues to pull ahead."
Deutsche Bank maintains a Hold rating of with a price target of $14, as the firm sees issues with display revenue ahead.
Deutsche Bank analyst says, "We feel 2011 represents another tough year of revenue declines as Google (NASDAQ: GOOG) impacts paid search and Facebook waits in the wings to impact Yahoo!'s display ad business. We think growth may resume in 4Q at the earliest, although we believe that Yahoo! must lower its monetization and re-invest in products."
Goldman Sachs maintains a Neutral rating on Yahoo with 6-month price target of $18.
Goldman Sachs analyst says, "We believe Yahoo! holders will take solace from the company’s stated desire to sell part of its 34% stake in Yahoo! Japan, if it can find a single buyer and a tax-efficient exit strategy. However Yahoo!’s display revenue is already at risk of falling behind its 2010-2013 growth target of 13%-16% yoy."
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Worthington Steel, Inc. (WS) Misses Q4 EPS by 3c
- RBC Capital Starts Enact Holdings Inc (ACT) at Sector Perform
- Currenc Group suspends Indonesian WalletKu unit operations
Create E-mail Alert Related Categories
Analyst Comments, Insiders' BlogRelated Entities
Deutsche Bank, Carol Bartz, EarningsSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
