Yahoo! Inc (YHOO): Today's Featured Internet Laggard

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.

Yahoo ( YHOO) pushed the Internet industry lower today making it today's featured Internet laggard. The industry as a whole closed the day down 1%. By the end of trading, Yahoo fell 22 cents (-1.2%) to $18.55 on average volume. Throughout the day, 29.5 million shares of Yahoo exchanged hands as compared to its average daily volume of 23.3 million shares. The stock ranged in price between $18.34-$18.84 after having opened the day at $18.55 as compared to the previous trading day's close of $18.77. Other companies within the Internet industry that declined today were: Net Element International ( NETE), down 19.2%, Zynga Inc Class A ( ZNGA), down 9.3%, Bankrate ( RATE), down 7.2%, and Renren Inc ADR ( RENN), down 6.4%.
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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 $22.32 billion and is part of the technology sector. The company has a P/E ratio of 5.8, below the S&P 500 P/E ratio of 17.7. Shares are up 17% year to date as of the close of trading on Friday. Currently there are five analysts that rate Yahoo a buy, one analyst rates it a sell, and 18 rate it a hold.

TheStreet Ratings rates Yahoo as a buy. 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 no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the internet industry could consider First Trust Dow Jones Internet Idx ( FDN) while those bearish on the internet industry could consider ProShares Ultra Short Technology ( REW).

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