As I go over Yahoo (YHOO) earnings data I was happy to see a decent increase in revenues even if earnings disappointed. However, it does seem that Google (GOOG) looks like the better value. (According to First Call, Google has a 2007 P/E of 35 vs. 52 for Yahoo). Then I came across the following blog entry by Jay Meattle at Compete.com: He shows top 20 US website usage ranked by time spent on line. MySpace, owned by Newscorp (NWS), comes in first at 11.9%. Second place belongs to Yahoo at 8.5%, four times the amount of time spent on Google (fifth place) at only 2.1%. These kinds of numbers continue to disappoint me in Yahoo's management who can't seem to monetize such an industry leading position. My support of shareholder activist Eric Jackson's Plan B to change Yahoo strategy continues as the best way to extract value from Yahoo.
This is duplicated on my personal blog at davidneubert.com.
Disclosures and Confessions: I own Yahoo and plan to pledge my shares to the campaign. However, if the shares rise above $35 I'm likely to start selling. I'm short Jan 2008 35 strike calls against half my position of YHOO and am also short Jan 2008 30 strike puts. I do not own Google (GOOG) but have traded it (both short and long) in the last two years. I do not own News Corp (NWS) nor have I traded it in the past two years.
I like Yahoo!. For years MyYahoo.com has been my browser startup page; I pay to use Yahoo enhanced email; I have over 2000 photos on flickr; I find Yahoo finance to be almost as good as Bloomberg but without the $1800 a month price tag; I have even been using Yahoo's search recently and find it so greatly improved that I don't need Google as much, I have registered websites using Yahoo.
Disclaimer: Nothing in this blog is meant to be specific financial advice or a recommendation to buy or sell. I do not give investment advice. Do your own research. Do not rely on anything in this weblog to make investment decisions. I do not log all my trades here. I only describe or mention those that I think might be interesting. Consult an investment professional familiar with your specific financial situation before buying or selling any security.
Keywords: Shareholder Activism, YHOO, GOOG, NWS, Eric Jackson, Plan B,