NEW YORK (TheStreet) -- After reporting fourth-quarter earnings on Tuesday, shares of Yahoo! (YHOO) are lower by over 6% in Wednesday's session. 

Yahoo! is in a difficult position, said TheStreet's Jim Cramer, co-manager of the Action Alerts PLUS portfolio. The stock has run up to $40, from $19 thanks to the company's stake in Alibaba, not for the work that CEO Marissa Mayer has done. 

However, it now appears Alibaba is beginning to slow, and so Yahoo! stock has more downside, he said. He called Yahoo!'s core business a "work in progress," which will also not help support the share price. 

The company has been underinvested for a very long time, Cramer said. The online "war" is currently between Google (GOOG) and Facebook (FB). GOOG is an AAP holding.

Yahoo! has "made some good acquisitions, they have more viewers but they're not producing more profits," he argued.

The company is not as strong as Google and Facebook technologically. On the Internet, technology is everything and "Yahoo! doesn't have the best yet," Cramer concluded.

-- Written by Bret Kenwell in Petoskey, Mich.

Bret Kenwell currently writes, blogs and also contributes to Robert Weinstein's Weekly Options Newsletter. Focuses on short-to-intermediate-term trading opportunities that can be exposed via options. He prefers to use debit trades on momentum setups and credit trades on support/resistance setups. He also focuses on building long-term wealth by searching for consistent, quality dividend paying companies and long-term growth companies. He considers himself the surfer, not the wave, in relation to the market and himself. He has no allegiance to either the bull side or the bear side.

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