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Thursday, January 18, 2001 By David Radin
Yahoo! is being pummeled by the investment community. In fact, this one time investment high-flyer is considered so down by the investment community that it currently has the dishonor of being the NASDAQ 100 company with the most analyst 'sell' or 'hold' recommendations. Unfortunately, many will look at this as another indication that the Internet is falling apart -- because its leader has broken down. However, when we look inside the news at Yahoo!, we don't find a company in trouble. We find that analysts are modifying their recommendations because -- oops, they did it again -- they became overly euphoric and sold their clientele up the river.
Remember a few years ago when there was a movement to make Yahoo! and a few other Internet stocks subject to the rules of mutual funds? These companies had purchased so many other Internet companies with their inflated stock that their outside investments exceeded the threshold that would qualify them as a mutual funds. Keep this in mind for a moment.
Back to this month's news from Yahoo!. Management announced that the company missed its earnings projections. Shame on them. But the company still grew from $590 million in revenues to $1.1 billion during the year. And fourth-quarter revenues grew more than 50 percent.
In fact, the company's income from operations grew from $48 million to $297 million for the year -- a very bad year for most Internet companies.
Now back to those investments. During the fourth quarter of 2000, Yahoo! had a net loss of $138 million -- from its investments in those other Internet companies, not from operations. That investment loss far exceeded the company's $87 million operating earnings from the same quarter.
Hence a loss -- based on the part of the company that looks a lot like a mutual fund.
From an investor's standpoint, that loss from investments is an important part of the value of Yahoo! stock. However, the Yahoo! brand is still growing -- getting stronger -- and the company is still the market leader, with no visible leadership erosion in sight.
We have to be realistic. Yahoo! is facing a much more difficult operating environment than during the past few years. Yet, in cutback markets, spending always favors the leaders.
So while the difficult market might mean less ad spending and growth for Yahoo!, it will still be at, or near, the top of the heap next year. And the company, along with the other strong Internet companies, will bury its competition as the year progresses.
More users are logging onto the Internet every day. But the advertisers have fewer choices when buying online advertising. In the long run, that's great for the market leaders.
Q: When I copy a section from a Web page to MS-Word, it often puts the selection into a table. How do I stop this from happening?
A: You won't always be able to avoid it. But you can reduce the number of times it happens. First, look for a printer-friendly page -- normally signified by a link that says "print this page" or something similar. Then copy your selection from that printer-friendly page. If there is no printer-friendly page available, copy your selection without the first and last words, which might help you dodge the frame of the table. Of course, you'll have to type in the two words after you paste.
If you still get the table in your new document, cut-&-paste the text from the table to a blank part of your document. When you select the text, make sure the whole cell isn't highlighted; otherwise, you'll continue your problem. If you've selected the text properly, the highlight will have a jagged right edge, and won't make the whole cell black.
David Radin is host of the nationally syndicated radio show "Internet Insider," a local version of which is aired on KDKA AM 1020 at noon Saturdays. You can ask him a computer or Internet question by following the instructions at www.post-gazette.com/interact, where you also can find an archive of his previous Q&A columns.
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