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Monday, January 24, 2011

Yahoo before and after Earnings

Today's winner : YAHOO !!!

About the Company:

Yahoo! Inc. provides online properties and services to users; and marketing services to advertisers worldwide.


Analysis


Yahoo has been seriously competing with google on the Ad revenues. Eventhough their Search Engine performance has improved vastly on tie ups with Google and other Search engines. Yahoo has been one of the best content providers there is , in my opinion better than all other players out there  especially presentation of content .


Let us do a Technical Analysis of the  Company stock 


Current Price as of Close 01/24/2011  is 16.09 $


Lets look at the Current Valuation 





YHOOIndustry AveragePercentile
in Industry
Market Capitalization$20.81B$5.63B98th
Beta (1 Year Annualized)0.091.2829th
EPS (Adjusted,$0.77$13.9087th
Current Consensus EPS Estimate$0.22----
EPS Growth
(TTM vs. Prior TTM)
755.56%+77.57%98th
P/E (TTM)
20.7334.2272nd
Dividend Yield (Annual) AS OF --2.65%--
Total Revenue (TTM)
$6.53B$16.51B99th
Revenue Growth
(TTM vs Prior TTM)
-0.05%+25.00%35th



Current PE is quite below the market average , so on the first look the stock is undervalued..


Lets look at the last Quarter earnings Report
Consensus : 0.15c    versus  Actual :  0.29c on Quarter ending October 2010


Here is the stock performance based on the earnings and other factors


Chart







the stock actually went up close 20 % and retraced back to October price range...


The  current consensus estimate for Tuesday's earnings report seems pretty low,  0.22c  , considering the fact that the Holiday sales for online retailers like Amazon  posted enormous gains  and increased traffic leading to higher Ad revenues .  The Ad Revenues must have grown many fold  than the previous recession years..


This is my prediction based on the current valuation and Yahoo possibly beating the low estimates


If they beat by 5c to 10c above consensus  -  Stock price will be around 17.5$


If they Beat twice the consensus like last time - Stock price might zoom past 18$


If they equal or come under the estimates (which is very rare) - Stock price might drop to $14.5 or lower..


 Yahoo is definitely  a Winner Tomorrow ...



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