Professional Documents
Culture Documents
Brian Bolan
Research Analyst
Technology Company Description
Jackson Securities, LLC Yahoo! is an internet search and technology platform for all media that
300 S. Wacker Dr., Suite 2450 has established itself as the leader in its growing market. Free downloads
Chicago, IL 60606 of applications, tools and other media based products have helped to
Ph: (312) 253-0578 broaden the idea of Yahoo! from more than just a search engine to a
Fax: (312) 986-0560 destination site and platform for new media delivery.
bbolan@jacksonsecurities.com
Valuation and Recommendation:
We believe that investors will no longer afford a large multiple to a growth
company that isn’t exhibiting all the signs that a normal growth company
shows. While some may think the worst may be over, we would rather
remain cautious in our stance at this time. We continue to recommend
investors HOLD shares of Yahoo!.
Jackson Securities, LLC seeks to do business with companies covered in its
research reports. As a result, investors should be aware that the firm may have a
conflict of interest that could affect the objectivity of this report. Investors should
consider this report as only a single factor in making their investment decisions.
Please also refer to the important disclosures found on page numbers 6 and 7.
Analyst Certification is found on page number 6.
Yahoo! (YHOO)
The rest of the story on the conference call mostly pointed out
challenges the company will face over the next 12 months. We
believe one of the key challenges will be the question of inventory.
This quote from the conference call tells us that an inevitable shift
is beginning to occur :
This tells us what many had believed for some time, and that is that
graphical advertising is taking over and new forms of advertising,
such as those advertisements one would see on a web video
production are right in step with the higher end graphical ads. The
Earnings
Earnings met our expectations of $0.11 per share, but revenue was
just slightly below our estimate of $1.137B. During the quarter we
lowered our estimates as the CFO noted that the company would
come in at the bottom half of the guided range.
Click Fraud
Click fraud almost vanished from the discussion, but this is not to
say that it isn’t still out there. An industry wide problem, click
fraud has been measured at about 14% of all ads that were clicked
on. We believe the number may be a little lower and that it is a
very difficult idea to get your arms around fully.
Valuation
al
al
al
al
al
al
al
A l
l
4 ed
a
ua
3'0 tu
2'0 tu
4'0 tu
1'0 tu
3'0 tu
4'0 tu
1'0 tu
2'0 tu
3'0 tu
t
ct
Q djus
Q Ac
Q Ac
Q Ac
Q Ac
Q Ac
Q Ac
Q Ac
Q Ac
Q Ac
4
6
A
2'0
4
1'0
Q
Important Disclosures
Disclosure of Conflicts of interest:
Neither Jackson Securities nor any of its publishing analysts or their immediate family members has a position in the
securities described herein.
Compensation:
• The research analyst has not received compensation based upon investment banking revenues or from the
subject company in the last 12 months.
• Jackson Securities has not in the last 12 months managed or co-managed a public offering of securities,
received compensation for investment banking services from the subject company or any compensation for
products or services.
• Jackson Securities does not expect to receive or intend to seek investment banking compensation from the
subject company in the next 3 months.
Market Making:
Jackson Securities does not make a market in this stock
Explanation of Ratings:
Buy - Expected 12-month absolute performance of +10% or higher
than the market price at which time the rating was issued.
Hold - Expected 12-month absolute performance of +5% to –5% from
the price at the time the rating was issued.
Sell - Expected 12-month absolute performance of –10% or lower than
the market price at which time the rating was issued.
Distribution of Ratings:
Jackson Securities, LLC has a distribution of ratings among its coverage universe as follows:
Buys – 65.52% (38 of 58 active recommendations)
Holds – 31.03% (18 of 58 active recommendations)
Sells – 3.45% (2 of 58 active recommendations)
Jackson Securities has provided investment banking services within the previous 12 months with the following
percentage of the companies they have rated:
Disclaimer: This communication is neither an offer to sell nor a solicitation of an offer to buy any securities
mentioned herein. This material should not be construed as an offer to sell or the solicitation of an offer to buy any
securities mentioned herein in any jurisdiction where such an offer or solicitation would be illegal. We are not
soliciting any action based on this material. It is for general information only, and it does not constitute a personal
recommendation or take into consideration the particular investment objectives, financial condition or financial needs
of any clients. Before acting on any advise or recommendation in this research report, clients should consider seek
professional advice. Past performance is not a guide to future performance. Future returns are not guaranteed, and
a loss of original capital may occur.
The information contained herein has been obtained from sources that we believe to be reliable, but we do not
guarantee its accuracy or completeness. Any opinions expressed herein are statements of our judgment on the date
appearing on this material only and are subject to change without notice. We endeavor to provide updates on a
reasonable basis of the information discussed in research reports, but there may be reasons which prevent us from
doing so.
Additional Information: Any additional information, if applicable, supporting this recommendation may be furnished
upon request. This report is not directed to, or intended for distribution to or use by, any person or entity who is a
citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication,
availability or use would be contrary to law or regulation or which would subject Jackson Securities or its affiliates to
any registration or licensing requirement within such jurisdiction. This report is prepared for the use of Jackson
Securities clients and may not be redistributed, retransmitted or disclosed, in whole or in part, or in any form or manner,
without the express written consent of Jackson Securities.
Brian Bolan
Research Analyst – Technology