Even so, Yahoo!'s shares, which have risen modestly over the past month, look cheaper than Google's based on a ratio of enterprise value -- market capitalization plus debt outstanding -- to earnings before interest, taxes, depreciation and amortization. Yahoo!'s multiple using that metric, which is often used to evaluate Internet stocks, is 25.6 -- compared with 38.3 for Google. "If there is such a thing as a bargain stock on the Internet, this would be one," says Mike Binger, who helps manage $1.5 billion for Thrivent Financial, including shares of Yahoo!. "Expectations for Yahoo! have fallen a lot." Yahoo!'s tight squeeze comes at a time of strong growth on the Internet. Advertising dollars are continuing to shift online from more traditional media, such as newspapers and television. Spending by marketers on the Web will jump 30% this year, according to Goldman Sachs analyst Anthony Noto, who says in a recent note that his forecast is "conservative." Advertisers are willing to pay premium prices to get placed on areas of high traffic, such as a home page. This trend is causing a shortage of available space on some sites including Yahoo!. Advertisers also are paying up for video content because they believe it causes users to remain on a site longer that they would otherwise. Wall Street is also expecting that improvements in Yahoo!'s search technology will begin to pay off next year. The company's search business, which trails Google, has long been a concern to investors. Yahoo! can't afford to rest on its laurels. The company has recently revamped its home page and added new features to its popular Yahoo! Finance site, such as improved features for charting. The company insists that the changes were not in response to Google Finance, the financial news site that was launched earlier this year. Investors will be looking for any updates on Yahoo!'s efforts to improve its search engine, which are expected to begin rolling out later this year. "We believe that this is the top R&D priority for Yahoo!," writes Citibank analyst Mark Mahaney, who rates Yahoo! outperform, in a recent note to clients. "It's hard to identify a catalyst as fundamentally important to a company as 'fixing' its search engine is to Yahoo!." Other areas that investors will focus on include Yahoo!'s recently announced alliance with eBay ( EBAY) and how it intends to fight the growing popularity of News Corp.'s ( NWS) MySpace social-networking site.