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I’m Bullish on Yahoo’s Stock Price and Value – At Least in Theory January 11, 2008

Posted by John in Technology.

NY Times is reporting that Yahoo’s core value is eroding.  This has been going on for some time.  Internal wars at Yahoo and new management changes have been hampering Yahoo for years. 

I’m bullish on Yahoo especially looking at the signals coming from their moves recently.  After plowing through their recent filing, I see the same old stuff.  What is not in the filing is the action over the past two years on the product side.   

It is commonly known in Silicon Valley that Yahoo product and business diehards have been working hard to get control of the product strategy and get it in the right direction.  In the shadow of Google Yahoo management feels like they have something to prove – that they can be technical, innovate, and make money.  You see it with the comeback of Jerry Yang and the public appearances by David Filo.   It appears to me that they are not going to roll over and ‘cry uncle’ to Google. 

Why am I bullish on Yahoo?  Yahoo has been opening up recently.  Opening up is going to hurt perfomance in the short term but help long term.  The fall before the rise.  Opening up for Yahoo will be at a price.  This is due to their business model based on a ‘walled garden’ with so much traffic.  The openness move has to be performed with precise execution.  Lets hope this ‘openness move’ doesn’t kill them.  Yahoo has been a big player in key open trends like RSS and Konfabulator (making the widget craze what it is today).  

If Yahoo does indeed open up the gains will be medium and long term.  Short term: expect more pain on performance but I’m bullish long term.  Yahoo has too many assets that will allow them to compete.  Can they pull it off will be the question.   I don’t know any of their top management anymore. 

Also coving this story are my favorite business bloggers:  On the west coast:  TechTrader Online – Eric Savitz  and Kara Swisher at BoomTown ; On the east coast:  SiliconAlley Insider – Henry Blogget.


1. stock picker - January 11, 2008

can you elborate more on the product strategy? what is your impression of the management there? I like your thesis, but would like to know more about time frames from your perspective.


2. blue007 - January 14, 2008

Hi John,

is there any possibility to send you an email? I can`t find any address in your blog…



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