Tracking Yahoo


by Ashish B Gupta - Date: 2006-12-17 - Word Count: 466 Share This!

Yahoo! was another one of the early Internet giants that got pummeled when the dot com bubble burst. YHOO stock lost over 87% of its equity value in the year 2000 alone! The company continued to lag throughout much of the new millennium as rival Google (NASDAQ: GOOG) became the preeminent Internet search engine and web portal; relegating Yahoo! to the status of glorified e-mail provider. Rather than fade into oblivion, however, YHOO parlayed the popularity of its e-mail interface into the worlds largest free and subscription electronic mail service.

Available in over 20 languages with industry-leading spam and virus protection plus significant free storage and attachment size capacity, Yahoo! Mail has helped to revitalize the company as a whole by providing a reason for users to visit the Yahoo! website and thereby create advertising opportunities. Since January 1, 2003, YHOO shares have nearly quadrupled in value!

According to Alexa 48% page views are generated from email.

mail.yahoo.com - 48%
search.yahoo.com - 11%
bid.yahoo.com - 4%
news.yahoo.com - 3%
login.yahoo.com - 3%
yahoo.com - 2%
360.yahoo.com - 1%
answers.yahoo.com - 1%

The company is betting on Yahoo 360 and Yahoo Answers as new source of revenue. According to Alexa only 1% of yahoo user's log into this service. The low percentage means that there is potential upswing and hence higher revenue. Yahoo 360 is a social networking website but it lacks the focus and moderation for elite group like businessman, investors or any serious group. The lack of moderation makes it unusable except for dating and spammers. Yahoo answers is a decent product and so far it sounds like usable tool. Yahoo could generate higher revenue through this product by integrating with other products (e.g. the investment section of yahoo answers should be integrated with yahoo finance).

The recent shakeup in management sounds like company is looking to establish a strategy. Yahoo has clearly lost advertising market share to Google Inc. (NASDAQ: GOOG). Google's share has risen to 45.4% in the United States in October from 39% a year earlier, while Yahoo's market share fell to 28.2% from 29.2%. It's also clear that Yahoo's stock has tumbled 30% this year while Google's has gained 17%.

The company continues to add more and more interactive and exclusive content to entice and engage new users. In his annual letter to shareholders, Yahoo! Chairman and CEO, Terry Semel, noted that the "number of unique users at the end of 2005 was approximately 21% higher than the previous year, on a comparable basis. Including the estimated audience of our strategic partners Yahoo! Japan and Alibaba in China, the global reach of the Yahoo! Brand approached an amazing half a billion users on a monthly basis at the end of 2005."

Only time will tell that whether Yahoo will loose or gain its users and page view. It is still ranked number one site on Alexa.


Related Tags: internet, investing, yahoo

With more than eight years of experience in investing, Ashish Gupta started his financial website http://www.istockanalyst.com

iStockAnalyst (http://www.istockanalyst.com) is the website dedicated to individual investors. The company is building a virtual investors community and supercharges the community with set of tools like chat rooms, message boards, actionable streaming commentary, streaming RSS aggregator, whisper number, comparative charting, blogs, integrated research, educational articles and more.

iStockAnalyst.com released earnings estimator tool in third quarter of this year. The tool is based on estimates entered by individual investors. The individual investors follow these companies very closely and they have good estimates about earnings. In last quarter a good number of companies reported earnings inline to estimates.

iStockAnalyst.com also offers live commentary (real time news analysis) in streaming format to help individuals investors take informed and timely decision.

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