Once the sensationalistic dust settles, investors will focus on the early portion of Mayer's tenure as a honeymoon period. Given this week's modest rise in YHOO, maybe they already have. As she begins setting the groundwork for a turnaround, we'll see more upside in the shares.

After last week's gains, YHOO trades at a price-to-earnings ratio just below 18. It's able to stay in the teens, as opposed to the single digits of Research in Motion ( RIMM) -- before it started losing money -- because, relatively speaking, its remains a revenue powerhouse, it does not seem to run the immediate risk of losing money, and plenty of eyeballs see value in the company's properties and content.

If you view the P/E ratio as I do -- as less of a valuation measure and more of a gauge of investor confidence in the future -- it's easy to see why you should expect more upside in YHOO on the heels of Mayer getting the CEO gig.

Yahoo Becomes a Player Again

Despite yowls from irrelevant peanut galleries, most people who matter in Silicon Valley lauded the hire. If you survey those who remain not only relevant, but influential and life-giving in tech -- venture capitalists and such -- the consensus is clear: We cannot believe Yahoo! pulled this off.

In the minds of many great tech/Internet/new-media thinkers and funders, Yahoo! became a player by hiring Mayer. Union Square Ventures principal Fred Wilson said it best on his blog: "Yahoo Is No Longer Dead To Me."

In other words, Yahoo!'s Board, by deciding to hire Mayer, but also by being able to pull it off, restored investor confidence. As a result, expect the stock to command a higher multiple in the coming months on the Mayer news alone.

Once she puts her mark on the Yahoo! -- by raiding Silicon Valley companies like Google for talent, for example -- expect more upside. If she goes on to execute, YHOO could become one of the decade's top multi-bagger turnaround plays.

At the time of publication, the author was long FB, P and ZNGA.

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

If you liked this article you might like

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

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

How to Play the Coming 'FANG Flu'

Travis Kalanick and the Terrible, Horrible, No Good, Very Bad Week