The company has come a long way from its years of market dominance in the early 2000s, with Google usurping much of Yahoo's former territory. Ironically, former Google executive Marissa Mayer now has the helm at Yahoo, and is finally righting the ship.
Yahoo has always been an excellent value as a company from an asset perspective alone—it's why Microsoft tried to purchase Yahoo back in 2008. But, under Mayer's leadership, Yahoo is finally starting to develop meaningful partnerships to take advantage of its online assets.
For instance, Yahoo recently signed on to a deal with Cloud-storage specialist Dropbox in order to offer broader Yahoo!Mail services. Most notably, however, is the deepening relationship with Apple.
Since both Apple and Yahoo have a common enemy in Google, a closer integration of services and data offerings on Apple iOS devices benefits both companies significantly, with Apple distancing itself from Google and Yahoo developing a much needed presence in the mobile market.
As for Yahoo's bottom line, Mayer's presence has helped reinvigorate stagnant revenue, with Yahoo banking 2% growth last quarter on earnings growth of 28%.
In fact, Yahoo has averaged earnings growth of 47% during the past four quarters. Investors should note that Yahoo is scheduled to release its 2013 Q1 earnings after the close on April 16. While we expect no real surprises, you should take only small bites ahead of the event, or hold off until after the report.
For the past several years, YHOO shares were as flat as the company's revenue growth. In fact, the stock hardly strayed outside of a 2-point trading range between 16 and 18 since the start of 2009.
That all changed in the second half of 2012, as Marissa Mayer was appointed CEO. The stock came to life following the news, embarking on rally in late October that would carry YHOO more than 60% higher. The stock has enjoyed solid support from its 25-day and 50-day trendlines throughout this uptrend.
With earnings looming, YHOO is trading at a multi-year high just below former support/resistance in the $25 region. Another solid quarterly report could be just the catalyst YHOO needs to extend its current revival.
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