Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
NEW YORK (
) has been reiterated by TheStreet Ratings as a buy with a ratings score of B- . The company's strengths can be seen in multiple areas, such as its solid stock price performance, compelling growth in net income, notable return on equity, attractive valuation levels and good cash flow from operations. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.
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Highlights from the ratings report include:
- Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Internet Software & Services industry. The net income increased by 977.5% when compared to the same quarter one year prior, rising from $293.29 million to $3,160.24 million.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. When compared to other companies in the Internet Software & Services industry and the overall market, YAHOO INC's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
- Net operating cash flow has significantly increased by 195.99% to $1,046.31 million when compared to the same quarter last year. In addition, YAHOO INC has also vastly surpassed the industry average cash flow growth rate of 1.21%.
Yahoo! Inc., together with its subsidiaries, operates as a digital media company that delivers personalized digital content and experiences worldwide. Yahoo has a market cap of $23.29 billion and is part of the technology sector and internet industry. The company has a P/E ratio of 6, below the S&P 500 P/E ratio of 17.7. Shares are up 22.1% year to date as of the close of trading on Tuesday.
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--Written by a member of TheStreet Ratings Staff.
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