Yahoo! (YHOO) has had more than its fair share of detractors, from analysts to investors to several of those in the media. Now, we are seeing our first activist analyst as the company's issues continue to mount with no solution in sight.

SunTrust analyst Bob Peck, who in the past has suggested that current CEO Marissa Mayer step down, has issued a letter to the company's board of directors, giving the Sunnyvale, Calif.-based company some ideas on how to handle its most pressing concerns -- the core business, taxes on the upcoming Aabaco spinout and lastly, management.

This is perhaps the first time in recent memory a sell-side analyst, a group who are usually friendly with a company's management so as to provide access for a bank's investment banking division, has issued a letter to a company's board of directors.

The issues at Yahoo!, a company who has seen its share price whittled away by nearly a third in 2015, are well known. In the company's most recent quarter, search revenue, excluding traffic acquisitions costs, fell 13% year over year, while display ad traffic rose just 2% from a year earlier when accounting for the costs.

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Since taking over the embattled Internet company, Mayer has put much of her focus on apps and mobility, code-naming the group MaVeNS -- mobile, video, native and search -- to try and drive growth. The collective group saw a 43% year-over-year rise in revenue, but it accounted for less than half of total revenue, at $422 million. By comparison, Facebook generated 76% of its $4.3 billion in advertising revenue from mobile in the third quarter.

EBITDA, one of the true measures of earnings power and potential of a company, has been cut by more than half since Mayer's arrival. Prior to her coming on board, Yahoo!'s 2012 annual earnings before interest, taxes, depreciation and amortization was $1.5 billion. Over the past 12 months, Yahoo!'s EBITDA has been cut in more than half, coming in at $630 million.

The company has reportedly hired consulting firm McKinsey to see if and how it should reorganize its business.

Here is the letter in its entirety:

To the Board,

Since we published our note on the 3 year review of the CEO's tenure, we have received a growing list of inquiries frominvestors. The concerns from investors have centered around 3 main areas: the lack of progress in turning the core around;the potential risks of the Alibaba spin not being tax free; and the stability and direction of management. Investors are askinghow engaged the board is and what it needs to see to enact change. We have faith in the board honoring its fiduciaryresponsibility, and would expect some publicly visible demonstration in strategy, asset rationalization, or management.

On Core Turnaround. Investors remain concerned that after almost 3.5 years and ~$7 billion in spending (acquisitions andR&D), that the management has been unable to show meaningful progress in the core turnaround. In fact, since 2012 thereported revenues and EBITDA have declined 9% and 45% respectively. What is more, the trend appears to be worsening, withthe recent quarter's reported revenues and EBITDA declining 8% and 20% year over year. Further, while investors are wellaware that the turnaround would not be quick, the metrics and goals that the management team has laid out have also notshown material progress. Lack of tangible progress in: People, Product, Traffic and Revenue has been a cause for concern (wedetail below). The same lack of tangible progress is evident in the company's MaVeNS (mobile, video, native and social)strategy. Lastly, it doesn't look likely that there is any near term reason for these metrics to inflect positive.

On Spin Taxes. While investors applaud the company's efforts to unlock value by spinning off the Alibaba asset, we believeinvestors have become more concerned around the possible amount of taxes of the spin, should the IRS ultimately tax thespin (please see our detailed note here). When the company began the process of pursuing a spin, one of the key tenets ofthis strategy was receiving a tax free ruling (PLR) from the IRS. This unfortunately did not occur and some investors wouldargue that a MAC (material adverse change) has occurred. While investors are optimistic that the spin should be tax free andhope to have an opinion letter from Skadden Arps shortly, there is still the risk that the IRS deems the transaction taxable,which could usurp the majority of the value of Yahoo's Alibaba (BABA, $79.85, Buy) shares. Lastly, the risk would ultimately betransferred to shareholders from the company, as any taxation would occur post the spin and paid by Aabaco. Pressingquestions are centered around what the likelihood is of the transaction being taxed and if the company should take that riskor wait until there is more clarity.

On Management. With concerns around the core's health and some risk in the Alibaba spin, investors have begun to revisitmanagement and the strategy. First, the executive turnover has accelerated in 2015 with key executives like Jackie Reses,Kathy Savitt, and Scott Burke having left. This year alone, we count 13 key executives who have left, which disrupts continuity.Additionally concerning is that Jackie Reses was supposed to run the Aabaco spin process and investors are unclear on who isleading that now. Further, the CEO recently stated on the earnings call that "the design and changes in Yahoo!'s leadershipteam are the result of careful planning to achieve the necessary skills, passion, and the ability to execute growth in ourbusiness. Our leadership team today is unequivocally the strongest during my tenure." This seems confusing to investors, asthe departed executives were hand-picked by the CEO originally. The company also mentioned on the earnings call that nowmay be "a unique opportunity to reset" and Recode reports that the company is hiring a consulting firm to plan yet anotherreorganization. Investors are asking that if this is true, is this a natural time to consider changes at the CEO level as well, giventhe issues discussed above. We believe the board must assess if the current management team has support of 4 factions:senior executives, employees, partners, and investors. If not, we think a seamless transition to new leadership could be in thebest interest of the company and shareholders.

As we stated above, we are respectful of the board and think it will continue to honor its fiduciary responsibilities. We don'tbelieve that the above concerns are unreasonable and would look for investors to get more clarity shortly. Below we gothrough each one of these topics in more detail to clarify the rationale for some of these concerns.

We look forward to a dialogue between the board and investors, as each seeks to maximize the success and value of theCompany.