The remaining rise in share price comes from Yahoo!'s 35% interest in Yahoo! Japan (you may have thought Yahoo! Japan was part of Yahoo, but it's a joint venture with Japanese company SoftBank).
The company needs to bring in someone to transform the company's massive inventory and user base into a monetized juggernaut it can be. The formula is so simple even a caveman can do it. Yahoo! doesn't have to reinvent fire, just copy Google's self-serve user interface allowing everyone with a credit card to place ads.
Google's greatest advantage over Yahoo! and Microsoft (MSFT) is the self-imposed denial to allow small advertisers the ability to advertise without picking up a phone. After years of watching Google grow in size and profitability, Yahoo! and Microsoft continue to operate their advertising business as if we are still in the 1990s.
Operationally, Yahoo hasn't grown profits in over 10 years. Meanwhile, Google increased operational profits over 2,000% and Microsoft already mature managed to double its operational profits. If Yahoo!'s former CEO Jerry Yang wasn't as great of a private equity manager as he is, Yahoo probably would trade for less than $10 if it wasn't already bought out.
Check Out Our Best Services for Investors
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts