Boston, MA 09/23/2014 (wallstreetpr) – Yahoo! Inc.(NASDAQ:YHOO) is slowly returning to normal trading margins after the close of Alibaba Group Holding Ltd(NYSE:BABA) IPO. If yesterday’s events in the market are something to go by, then investors focus has shifted to the company’s ailing core business. Yahoo has on it’s hand an impressive cash balance after offloading some of its stakes in Alibaba awaiting to see the next move by CEO, Marissa Mayer.
Yahoo Down by 10%
Yahoo! Inc. (NASDAQ:YHOO)’s stock has not been doing well in the market having tumbled on Alibaba moving forward from the much-publicized IPO. The stock has already dropped by 10% in the recent days having surged by a mere 30% over the past year alone. The 22% stake it held in Alibaba in away shielded it from the wrath of Wall Street as investors continue to hold hope that the remaining stakes will work to it’s advantage going forward.
The main concern at the moment is the fact that Yahoo! Inc. (NASDAQ:YHOO)’s Asian holdings led by Alibaba and Yahoo Japan have surpassed the company’s core business, in terms of valuation. Despite generating a whopping $4.6 billion the past year with monthly users thought to be in the range of 1 billion, Yahoo! Inc.(NASDAQ:YHOO) still lags behind Google Inc.(NASDAQ:GOOG) and Facebook Inc.(NASDAQ:FB) in terms of online presence. Another concern is the fact that despite Mayer carrying out a number of acquisitions, users growth has stagnated compared to Google and Facebook, which are benefiting a great deal from massive following.
Advertisers May Pull Back
Forest Research analyst James McQuivey believes Yahoo! Inc. (NASDAQ:YHOO) could immensely be affected by advertisers pulling away as the company continues to be devalued as an advertising platform when compared to Google and Facebook. Having recouped up to $7 billion from the sale of part of its stake in Alibaba, Yahoo has already stated that it plans to return half of the amount to shareholders. It is still unclear how the amount will be distributed to shareholders and to what use will the remaining amount be used for.
