Yahoo! Inc. (NASDAQ:YHOO) Earnings Preview – Stock Down 10% Since Last Report

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Yahoo! Inc. (NASDAQ:YHOO) is expected to report first quarter earnings after the market close on Tuesday, April 15 with a conference call scheduled for 5:00 pm ET. Yahoo is a digital media company that provides properties and services such as Yahoo! Search and Yahoo! News.

Analysts are looking for EPS of 37c on revenue of $1.08B. The consensus range is 25c-48c for EPS, and $1.03B-$1.1B for revenue, according to First Call.

Yahoo reported Q4 EPS 46c against estimates of 38c on revenue ex-tac of $1.2B against estimates of $1.2B. It also reported Q3 Display revenue $491M and reports number of ads sold increased 3%. The company gave Q1 revenue guidance of $1.06B-$1.1B and Q1 non-GAAP operating income $130M-$170M. During its conference call last quarter, the company said the growth trend in mobile revenue is “promising” and it expects a modest decline in FY14 EBITDA.

The company is set to release revenue and profit numbers from Alibaba Group ahead of its expected filing for a U.S. initial public offering, which may value the company at more than $100B. In the past quarter, Yahoo also announced it acquired eAccess from SoftBank for Y324B as well as smaller acquisitions of Incredible Labs, Wander, Vizify and Distill. Yahoo announced a partnership with Yelp (YELP) and increased integration with OpenTable (OPEN) reservations into its local search results. At the Morgan Stanley Technology, Media and Telecom conference, Yahoo said its focus on FY14 will be back to growth after a dissatisfying FY13. According to a recent report from Re/code, however, Yahoo’s upcoming quarter is “as lackluster as the last,” according to sources inside the company.

In recommendations, JMP Securities said Yahoo is more focused on revenue growth and has become more upbeat with Yahoo’s outlook following a meeting with the CFO. BGC, however, said Yahoo is likely to report a “tepid” quarter with revenue to be flat YoY. Ahead of the earnings, Suntrust and Macquarie upgraded the company citing a favorable risk/reward following the recent pullback in shares and ahead of the Alibaba IPO.

Yahoo shares have dropped over $3.50, or more than 10%, since the first day of trading following the company’s Q4 report. In Tuesday midday trading ahead of Q1 report, Yahoo shares are down approximately 1%.

Analysts have a consensus price target of $36.33 on Yahoo! Inc. (NASDAQ:YHOO) which indicates a 9.87% downside. The consensus rating of the stock is a HOLD with a score of 2.48. There are currently 14 Hold Ratings, 16 Buy ratings and 1 Sell ratings on the stock.

The most recent analyst action consisted of Zacks reiterating their neutral rating and $38 price target.

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