Hold Off on Yahoo! Stock, But Give New CEO Benefit of the Doubt

NEW YORK ( TheStreet) -- Shortly after Yahoo! ( YHOO) named longtime Google ( GOOG) executive Marissa Mayer CEO, TheStreet's Chris Ciaccia could not have been more clear about his feelings in an article titled, Marissa Mayer is a Bad Choice for Yahoo!

That was my initial reaction as well.

Twice, in the days and hours leading up to the Mayer announcement, I took Jim Cramer's side and championed a long play on YHOO, noting the time was coming for the stock to break out of its $15 range. Like Cramer, I made the call contingent on Yahoo! doing what so many people expected -- making its most recent interim CEO, Ross Levinsohn, the permanent man for the job.

As YHOO stock flirted with $16 in after-hours trading Monday, I could have patted myself on the back. I'm not quite ready to do that. I made the call for upside in a completely different context than the one that unfolded Monday afternoon. Because Levinsohn did not get the gig, I'm no longer ready to get long YHOO. At least, not this second.

That said, I have to reserve judgment on Mayer. It would be unfair to do otherwise.

I advocated for Levinsohn because it was clear based on his history, words and actions as interim CEO that he was going to aggressively position Yahoo! as the digital media company it should have been all along. Just because he did not get the job, we cannot assume that the Yahoo! board and Mayer do not agree with this strategy.

In fact, the scant early and official word from Mayer does jibe with Levinsohn's vision: "I look forward to working with the Company's dedicated employees to bring innovative products, content, and personalized experiences to users and advertisers all around the world."

Granted, that's one sentence from a corporate press release. But in the immediate aftermath that's part of the very little we have to go on.

Content. Personalized experiences. That sounds like a digital media direction to me.

We have to give Mayer and Yahoo!'s Board the benefit of the doubt. For all we know, she might have been the brains behind Google for the last 13 years. I certainly would not put the company's other leaders on par with the likes of Steve Jobs or Jeff Bezos.

In a few articles I came across, Mayer expanded on what she'll do at Yahoo! In summary, she plans to leverage the strong but woefully under-utilized franchises at Yahoo! -- namely Finance and Sports. That's what she needs to do, build on these excellent brands. If she follows through like Levinsohn appeared to be doing during his short stint as interim CEO, I will quickly become a bull.

I have to believe Mayer shares Levinsohn's vision. If not, the Yahoo! board and executive office is in greater disarray than previously thought. Why would the company sign major partnerships with significant media-related brands such as CNBC and Spotify only to go in an entirely different direction?

Of course, because Mayer is female she will draw even more attention and, quite possibly, face a different type of scrutiny.

If she does not thing else as CEO of Yahoo!, I hope she can accomplish two things. Both relate to the pathetic carnage former bombastic Yahoo! CEO Carol Bartz left behind.

Mayer sets out on the road to winning if she can restore employee morale at Yahoo! and return the class and professionalism not only Bartz, but it seems Scott Thompson, sucked out of the company's CEO office over the last several years.

At the time of publication, the author held no positions in any of the stocks mentioned in this article.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

If you liked this article you might like

Mellanox Must Hike 2018 Targets or Face Activist Escalation, M&A

Mellanox Must Hike 2018 Targets or Face Activist Escalation, M&A

Amazon's Taxes, Yahoo! Breach, PepsiCo Earnings: Wednesday's Top Stories

Amazon's Taxes, Yahoo! Breach, PepsiCo Earnings: Wednesday's Top Stories

Equifax Breach Reveals Frightening Truth: Companies Can Delay Disclosing Hacks

Equifax Breach Reveals Frightening Truth: Companies Can Delay Disclosing Hacks

How Alibaba's 'Genie' Smart Speaker Can Overcome the Amazon Echo's 3-Year Head Start and Still Win

How Alibaba's 'Genie' Smart Speaker Can Overcome the Amazon Echo's 3-Year Head Start and Still Win

Facebook, Apple, Netflix and Google Have Caught the Flu -- Here's How Not to Get Killed By It

Facebook, Apple, Netflix and Google Have Caught the Flu -- Here's How Not to Get Killed By It