A harsh Yahoo reality check
Listening to the droning, jargon-filled Yahoo conference call on Tuesday night, you could only think that Jerry Yang and Sue Decker were aiming their conversation only at analysts who needed to fill out their 2008 spreadsheets.
That strategy didn’t work. Yahoo shares are down 9 percent today to $19.01. The analysts have been busy reducing their target prices on the stock. Citigroup, Oppenheimer and Pacific Crest Securities dropped Yahoo from their recommendation lists. This is what Sandeep Aggarwal, of Oppenheimer, said in his note downgrading Yahoo shares and reducing his price target from $30 to $20 a share:
With margins in free-fall, and no clear revenue implication of the investment spending, we believe investors are likely to view the stock as a value trap.