Yahoo (YHOO) Is Today's Pre-Market Laggard Stock

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.

Trade-Ideas LLC identified Yahoo ( YHOO) as a pre-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified Yahoo as such a stock due to the following factors:

  • YHOO has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $3.0 billion.
  • YHOO traded 1.3 million shares today in the pre-market hours as of 8:20 AM.
  • YHOO is down 3.4% today from yesterday's close.

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More details on YHOO:

Yahoo! Inc. operates as a technology company worldwide. YHOO has a PE ratio of 36.7. Currently there are 14 analysts that rate Yahoo a buy, no analysts rate it a sell, and 6 rate it a hold.

The average volume for Yahoo has been 22.6 million shares per day over the past 30 days. Yahoo has a market cap of $42.3 billion and is part of the technology sector and internet industry. The stock has a beta of 1.04 and a short float of 2.8% with 0.38 days to cover. Shares are up 5.6% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Yahoo as a buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, solid stock price performance, good cash flow from operations, expanding profit margins and reasonable valuation levels. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • Although YHOO's debt-to-equity ratio of 0.09 is very low, it is currently higher than that of the industry average. Along with this, the company maintains a quick ratio of 2.99, which clearly demonstrates the ability to cover short-term cash needs.
  • Compared to its closing price of one year ago, YHOO's share price has jumped by 38.31%, exceeding the performance of the broader market during that same time frame. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
  • Net operating cash flow has slightly increased to $357.41 million or 8.03% when compared to the same quarter last year. Despite an increase in cash flow, YAHOO INC's cash flow growth rate is still lower than the industry average growth rate of 41.67%.
  • The gross profit margin for YAHOO INC is currently very high, coming in at 83.10%. Regardless of YHOO's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, YHOO's net profit margin of 24.87% compares favorably to the industry average.
  • The revenue fell significantly faster than the industry average of 43.9%. Since the same quarter one year prior, revenues slightly dropped by 4.5%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.

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