Yahoo! Fans Don Rally Caps

To be sure, Yahoo! is facing heightened competition from Google, which is trying to lessen its dependence on search. Google recently launched a financial news Web site, Google Finance, that competes with Yahoo! Finance. Google also is looking to add new offerings in areas like health.

Meanwhile, Google also continues to increase its stranglehold on the search market at Yahoo!'s expense. comScore Networks estimates that Google's share was 42.3% in February, up 6 points from a year earlier, while Yahoo!'s fell 3.5 points to 27.6%.

Yahoo!, which entered the search business through its $1.63 billion acquisition of Overture in 2003, remains solidly ahead of the other rivals including Microsoft's (MSFT Quote) MSN and Time Warner's (TWX Quote) AOL.

Yahoo! investors are awaiting improvements to its search engine that are expected to be announced later this year. The company also is considering offering premiums, like discounts on movie rentals, in an effort to get people to use the service.

"They have invested a lot in their search technology and it is likely this year going to make them more competitive in search compared with Google," says Ted Moore, an analyst with National City Private Client Group, who doesn't recommend shares of Yahoo! or Google.