Sahar Samadian

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• Sahar Samadian
• Kevin Polasek
• Alan Nguyen

Vivette Calvo
Hena Khan
Candice Ghan
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Background Information
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A Student Hobby An Idea is Born

• The creators of Yahoo! are David Filo and Jerry
  Yang who were two PhD. students at Stanford
  University.
• They first formed the idea of Yahoo! as a hobby
  in 1994 in their campus trailers in Sunnyvale,
  California.
• Yahoo! served as a guide that kept track of both
  students favorite internet websites.
• Soon after they turned their idea into a full
  time activity and both students were spending
  more time on their website than in writing their
  doctoral dissertations.

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Yahoo! Beginnings

• Yahoo! began as a simple student hobby that
  evolved into a multinational entity that has
  influenced and changed the course of
  communication throughout the globe!

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Yahoos! First Steps Toward Success

• In March of 1995 the duo met with venture
  capitalist and incorporated Yahoo! Shortly after
  they met with Sequoia Capital a well regarded
  firm whos most successful investments included
  Apple computers, Atari, Oracle and Cisco Systems,
  and they agreed to fund Yahoo! with an initial
  investment of 2 million dollars.
• This set the course for what Yahoo! would become
  today and in only a year Yahoo! became a publicly
  traded company as of April 1996 with a total of
  49 employees.

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YAHOOS EXPANSION

• Yahoo! was the first online navigational guide to
  the Web and its potential for growth was evident
  and to this day is the No. 1 Internet brand
  globally and reaches the largest audience
  worldwide.
• Throughout the years Yahoo! has made it a
  priority to expand its business globally and
  because of its international endeavors Yahoo!
  currently holds various offices in Canada, Latin
  America, Europe, Asia, and Australia.
• Today Yahoo! is a leading global Internet
  communications, commerce and media company that
  offers a comprehensive branded network of
  services to more than 345 million individuals
  each month worldwide.

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How international is Yahoo?
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Profile

• To this day Yahoo! is one of the leading global
  Internet companies providing a variety of
  services to consumers and business. Yahoo! offers
  these amenities through its worldwide network of
  online properties and affiliated services.
• Essentially Yahoo! seeks to provide global
  Internet Services that are effective, innovative
  and of highest quality to its users. One of
  Yahoos! primary services is to connect its users
  to a variety of resources and information that is
  available throughout the web.
• Yahoo! also serves as a middleman that provides
  valuable and effective marketing services for
  business that advertise in Yahoo! and can
  therefore reach a broad range of users. Their
  focus is to increase the number and value of
  their user base in the Yahoo network and in their
  affiliate networks that integrate search
  offerings for Yahoo! so that Yahoo! can continue
  to be the leading and most trafficked global
  Internet brand.

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Cont

• Search and Marketplace
• Information and Content
• Communication and Consumer Services
• Affiliated services

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Board of Directors
Gary L. Wilson Chairman
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5 Insider Ownership
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Market Capitalization
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Total Market Capitalization of Computer Services
Industry
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Revenue Sources
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Industry Background
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TTM Sales
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Financial Ratios
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Financial Condition
Yahoo's Financial Condition is GOOD!
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Growth Rates ()
Yahoos Growth Rate () is FAIR!
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Price Ratios
Yahoos Price Ratios are FAIR!
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Profit Margins ()
Yahoos Profit Margin () is STRONG!!
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Investment Returns
Yahoos Investment Return () is STRONG!!
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Management Efficiency
Yahoos Management Efficiency is GOOD!
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Market Efficiency
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Company Specific News
Weak Form
Positive Yahoos Ad Growth Keeps profits climbing
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Non-Company Specific News
No Form
Tokyos benchmark stock index higher at open
April 20, 2005
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Risk Analysis
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Discounted Cash Flow
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Risk Analysis
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5 Year Stock Price Chart

• The 5 year stock price chart shows how Yahoo
  performed over the period of time. Yahoo was
  prosperous as the rest of the technology industry
  before January 2001.
• After the well-known burst of the technology
  bubble, Yahoos stock plummeted. At the quarter 3
  of 2001, Yahoos stock was shaky up to until one
  year after that point, quarter 3 of 2002.
  Following that point in time, Yahoo has seen a
  steady recovery. Currently, Yahoos stock is
  stable and is a top choice to invest in. Although
  it has not reached its pre-2001 price high, Yahoo
  is still strong, solid stock.

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YAHOO!S STRENGTHS WEAKNESSES

• Strengths
• Capital Structure
• Many of the services Yahoo! offers are free to
  users.
• Yahoo! has structured its company by maintaining
  a higher percentage of equity in comparison to
  that of debt.
• -- From the charts it is evident that In 2002
  their equity amounted to be 82 while there
  debt stayed fairly low at only 18.
• Yahoo! has continuously maintained its capital
  structure by having a higher equity base than
  debt base.
• The Analysts show strong support of YAHOO stock.
  This gives the company a positive review.
• YAHOO has aggressively sought out to increase
  their market share both domestically and
  internationally. Thus this has enabled them to
  maintain the brand name, and increase their
  bottom line. They have continued to do this on a
  yearly basis.

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Cont

• Financial Condition
• Profit Margin The profit margin of YAHOO,
  compared to both the industry and whole industry
  level is strong. Thus this indicates that YAHOO
  has less debt, and more equity, allowing a
  positive margin.
• Investment Returns YAHOOs investment return
  is strong. The return on Equity is much higher
  compared to the industry level, and less than a
  whole point short compared to the whole industry.
  For someone planning on investing in this stock,
  they can sure that this company has less
  liability and more equity. In essence this
  concept is relevant in making any form of
  investment.
• YAHOO! Has been able to double their profit very
  rapidly from year-to-year. For example, from
  2003-2004, YAHOOs revenues increased by 120.
  

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Cont

• Other Strengths
• Internet giant announced another blow-out quarter
  Tuesday 4/19/05, doubling first-quarter profit
  from a year earlier and handily beating analyst
  expectations.

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Weaknesses

• In the capital structure, YAHOO! spent more money
  then they borrowed. They have continued to double
  their spending.
• In certain markets, YAHOO has depended on a
  limited number of sources to direct a significant
  percentage of users and businesses to our service
  to conduct searches and a loss of these sources
  in certain markets.
• YAHOO expects operating service expenses to
  continue to increase as they attempt to expand
  the YAHOO network. Thus if expenses increase at
  a greater pace than revenue, then this can harm
  YAHOOs operating results.

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Cont

• YAHOO said that they are increasingly being
  targeted by online fraudsters, who exploit
  weaknesses in the Internet ad system to generate
  revenue or hurt their competitors. The Internet
  giants said they are working to combat the
  problem, but some advertisers accuse the
  companies for not moving aggressively enough
  because they also profit from other scams.
• More individuals are utilizing non pc devices to
  access the internet, and versions our YAHOOs
  service developed, or optimized for these devices
  may not gain a wide spread adoption by users of
  such devices.
• New technologies could block YAHOOs ads, which
  could harm YAHOOs operating results.
• If YAHOO! fails to detect click-through fraud, we
  could lose the confidence of our advertisers,
  thereby causing a loss of advertisers and
  revenue.

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Analyst Opinion

• For Potential Investors
• The analysts are in strong support of investing
  in Yahoo by purchasing common stock according the
  graphs. For the past 3 months and at the current
  time period, the vast majority of analysts rank
  Yahoo as a STRONG BUY.
• For Current Stockholders
• Analysts recommend that investors either hold
  their current shares or purchase additional
  shares. Currently, it is not recommended by any
  one of them to sell, and in recent months,
  minimal support was shown to sell the stock.

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Buy, Sell, or Hold?

• Sahar Samadian- Buy
• Alan Nguyen- Buy
• Vivette Calvo- Buy

• Hena Khan- Buy
• Kevin Polasek- Buy
• Candice Ghan-Buy

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Do you
?
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Thank you for your time!