YAHOO! (YHOO): On Oct. 4, Thomas Weisel Partners reiterated its STRONG BUY on Internet portal YAHOO!. The report is a preview of YAHOO!'s third-quarter earnings, which are scheduled to be announced after the market closes on Oct. 10. Weisel Partners believes that YAHOO! will meet the firm's estimates, which call for revenue of $279.1 million and earnings of $0.10 a share. Weisel Partners remains bullish on the company because of the site's strong traffic. The brokerage notes, for instance, that it was the second most-used site for sports news during the Olympics. Weisel Partners expects YAHOO! "to be a beneficiary of ad spending consolidation, emerging in an even stronger leadership position over the long term." The firm used both a relative (price-to-sales) and a discounted cash-flow valuation. It estimates that the company will earn $0.43 a share in 2000 and $0.61 a share in 2001. YAHOO! closed at $81.25 on Oct. 6. Research on YAHOO! was downloaded 2,664 times and 79 new reports on the company were added to the Multex.com database from Sept. 25 to Oct. 1.
YAHOO!'s results, in fact, beat Weisel Partners' forecasts. Revenue was up 8% quarter-to-quarter to $295.6 million. Earnings came in a $0.13 a share. The company, for the first time, disclosed that dot-com advertisers accounted for 40% of total revenue in the third quarter, down from 47% in the second quarter. Management adopted a cautious tone in its conference call discussing the results, referring several times to the "difficult environment." YAHOO! was trading below $70 on Oct. 11, when Weisel Partners once again reiterated, its STRONG BUY rating on the stock.
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