Yahoo Shares Bounce on Turnaround Hope, But Next Quarter’s Guidance is Light (YHOO)

Tom Reese/Paul


Shares of Yahoo (YHOO) are rallying in the pre-market,

despite the internet giant posting a net loss of $303 million, or 22 cents a

share in the period ended in December, compared to a profit of $206 million, or

15 cents a share, in the same period a year earlier.

The company has a new CEO and will be looking to figure out

the best plan of action regarding its search business, which Microsoft (MSFT)

may still have a good interest in, if there is an initiative to re-open talks


Looking ahead, the company sees revenue to likely be in the

$1.1-1.26 billion range. The consensus estimates are for revenue of $1.29 billion.

The Bottom Line

Shares of Yahoo lost nearly 50% of their value in 2008. The stock has long-term

technical support in the $4.50-5.00 price area. If the shares can begin to

strengthen, we see overhead resistance in the $14-18 area. We do not currently rate

this non-dividend paying stock, but would prefer Google (GOOG) over Yahoo at

this current time.

Yahoo (YHOO) does not currently pay a dividend.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well

as a detailed explanation of our ratings

system here.

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