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New Team Means Growth for Yahoo?

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  • Description

    Morningstar senior equity analyst Rick Summer weighs in on management and board troubles at Yahoo.

  • Duration 3:25
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Thank you very much by -- -- All right well obviously we're saying on the big news coming out of Yahoo! right out of makes sense of what this means to Yahoo! and -- stock.

I'm joined by Rick summer he's a senior equity analyst at Morningstar Rick thank you for being here so many questions -- -- -- talk about.

The value add -- a new team coming get a Yahoo! does this mean growth.

For the company the stock is trading higher today tell us what that means.

Yet I think this is a great case T steps backwards -- one step forward here as we've watched that management troubles that we've had in the board troubles away pat.

You know clearly clearly had a lot of in the size and indecisiveness around what we needed a new Scott Thomson.

He's been cast aside what we -- forward we don't have a lot of clarity in terms of how you actually reinvigorate growth.

We know we have an activist hedge fund manager on board now.

We know clearly he's -- laser focus on that stock price but we don't have a great deal of clarity around how they're gonna reinvigorate invigorate the core business.

Well let me ask you about some of the other analysts have been talking about that the stock today's steeple Nicholas says.

With regards to Ross Levinson extremely qualified executive -- a service like calming force amid the turmoil in -- securities neutral fourteen dollars his -- background.

He's worked as several HBO CBS that's a positive in our -- are those positive in your view.

Yes -- yes -- a great background but in terms of kind of stemming the formal over the employee base employees right now -- laser focused first ever focused on Scott Thompson in the troubles that they had.

But they understand that Dan -- an activist shareholder -- money guy is gonna have a great deal of influence over the strategy.

And quite frankly the exact as the we talked to are thrilled about that.

I think secondly you look at -- -- background clearly very credible very senior and just a class act and a and a great -- to be able to manage the company.

On the flip side the challenge is not necessarily embracing advertisers.

We have users that are still fleeing the service people aren't using Yahoo! Search.

It's not clear that -- can actually change.

That aspect of the business at the same time while embracing advertisers.

Well it seems so that they really are gonna try and an eleven think could be the -- to do this really monetize the immediate contents.

At Yahoo! that and -- orchestrate a sale at least a part of the alum Bob Ali Bob us sake do you think that that's a possibility -- women make you bullish on the stock.

Answers -- we have two different components here one has obviously the Yahoo! Japan.

And the -- -- assets we've had a lot of Smart people look at this and we haven't been able to come to an agreement to date.

Clearly that would be a catalyst for the stock but we've had a lot of challenges and actually.

Realizing any value it's not clear that the party today vs the party yesterday vs the party twelve months ago.

Has any advantages over doing that.

I think secondly you look at how you actually invigorate the media assets.

Clearly that's the core what Yahoo! is today you look at sports you look at finance you look at entertainment.

Those are great assets to be able to have but you've got to be able to grow that audience.

Step one yes you can charge higher prices for advertising that's great we think that's low hanging fruit we think they'll execute very well there but what's next.

We have news aggregation services we have folks like court in the start -- plan.

Grabbing audience that's going to be a bigger -- for Yahoo!.

Rick summer there's -- a lot of things that are gonna -- -- folding in this story thank you very much -- summer for Morningstar but again you know Ross Levinson that if you were saying -- -- the -- got credit in this may yeah.

What young -- -- need some.

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