Buy Today: Yahoo! Inc's Buy Recommendation Reiterated

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

NEW YORK ( TheStreet) -- Yahoo (Nasdaq: YHOO) has been reiterated by TheStreet Ratings as a buy with a ratings score of B+. The company's strengths can be seen in multiple areas, such as its solid stock price performance, increase in net income, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and expanding profit margins. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • Powered by its strong earnings growth of 43.47% and other important driving factors, this stock has surged by 80.64% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, YHOO should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Internet Software & Services industry average. The net income increased by 27.9% when compared to the same quarter one year prior, rising from $272.27 million to $348.19 million.
  • Although YHOO's debt-to-equity ratio of 0.08 is very low, it is currently higher than that of the industry average. Along with this, the company maintains a quick ratio of 3.27, which clearly demonstrates the ability to cover short-term cash needs.
  • The gross profit margin for YAHOO INC is currently very high, coming in at 83.75%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 27.50% is above that of the industry average.

Yahoo! Inc., a technology company, provides search, content, and communication tools on the Web and on mobile devices worldwide. Yahoo has a market cap of $37.8 billion and is part of the technology sector and internet industry. Shares are down 7.5% year to date as of the close of trading on Monday.

You can view the full Yahoo Ratings Report or get investment ideas from our investment research center.

--Written by a member of TheStreet Ratings Staff.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.
null

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