Yahoo!’s Second Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Yahoo (NASDAQ:YHOO) will unveil its latest earnings on Tuesday, July 17, 2012. Yahoo is a digital media company that delivers personalized digital content and experiences across devices worldwide.

Yahoo Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for profit of 20 cents per share, a rise of 5.3% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved up from 19 cents. Between one and three months ago, the average estimate moved up. It has been unchanged at 20 cents during the last month. Analysts are projecting profit to rise by 13.3% versus last year to 94 cents.

Past Earnings Performance: Last quarter, the company beat estimates by 7 cents, coming in at net income of 24 cents a share versus the estimate of profit of 17 cents a share. It marked the fourth straight quarter of beating estimates.

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A Look Back: In the first quarter, profit rose 28.4% to $286.3 million (23 cents a share) from $223 million (17 cents a share) the year earlier, exceeding analyst expectations. Revenue rose 0.6% to $1.22 billion from $1.21 billion.

Stock Price Performance: Between April 16, 2012 and July 11, 2012, the stock price rose $1.02 (6.9%), from $14.79 to $15.80. The stock price saw one of its best stretches over the last year between November 23, 2011 and December 1, 2011, when shares rose for six straight days, increasing 8.6% (+$1.29) over that span. It saw one of its worst periods between December 1, 2011 and December 8, 2011 when shares fell for six straight days, dropping 3.8% (-62 cents) over that span.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 3.25 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands.

Key Stats:

On the top line, the company is looking to build on last quarter’s revenue increase, which snapped a string of revenue drops. Revenue fell 23.3% in the second quarter of the last fiscal year, 24% in the third quarter of the last fiscal year and 13.2% in the fourth quarter of the last fiscal year before climbing in the first quarter.

Heading into this earnings announcement, the company is trying build on some positive momentum from last quarter’s income increase. After net income declines in the third quarter of the last fiscal year and fourth quarter of the last fiscal year, profit rose in the first quarter.

Analyst Ratings: There are mostly holds on the stock with 18 of 26 analysts surveyed giving that rating.

Wall St. Revenue Expectations: On average, analysts predict $1.09 billion in revenue this quarter, a rise of 0.9% from the year-ago quarter. Analysts are forecasting total revenue of $4.49 billion for the year, a rise of 2.5% from last year’s revenue of $4.38 billion.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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