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, reasonable valuation levels and expanding profit margins. We feel these strengths outweigh the fact that the company shows weak operating cash flow.
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Highlights from the ratings report include:
- Powered by its strong earnings growth of 52.17% and other important driving factors, this stock has surged by 62.63% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, YHOO should continue to move higher despite the fact that it has already enjoyed a very nice gain 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 36.3% when compared to the same quarter one year prior, rising from $286.34 million to $390.29 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. Compared to other companies in the Internet Software & Services industry and the overall market, YAHOO INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- The gross profit margin for YAHOO INC is currently very high, coming in at 83.40%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 34.22% significantly outperformed against the industry average.
Yahoo! Inc., a technology company, provides search, content, and communication tools on the Web and on mobile devices worldwide. Yahoo has a market cap of $27.8 billion and is part of the technology sector and internet industry. The company has a P/E ratio of 7.00, below the S&P 500 P/E ratio of 18.00. Shares are up 24% year to date as of the close of trading on Monday.
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--Written by a member of TheStreet Ratings Staff.
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