Yahoo! is set to report its fourth-quarter results on Tuesday, January 26th.  The stock continues to under-perform the market, having declined by over 12% over last three months. In contrast, the NASDAQ composite index is down a less painful 8%. The primary reason for this under-performance has been Yahoo’s stalled plans to spin off its Alibaba stake to shareholders, which it fears it cannot do on a tax free basis. Accordingly attention has turned to the core business, which has failed to generate sufficient revenue from its online ads business. As a result, the market is rife with rumors that the company plans to sell its internet business, as activist investors wish.  We believe that the company will continue to report little or no improvement in revenue growth due to a secular decline in its desktop business and inability to monetize its mobile platform. Therefore, in this earnings announcement, we will closely monitor the search and display ads divisions for growth in revenues from the mobile segment as the company continues to push for more services in this domain. In sum, we (as most observers) look to management to articulate strategics moves out of the present conundrum.

from Forbes – Tech http://ift.tt/1Pu5L3E
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