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Yahoo! – Sentiment Remains Depressed Ahead of Earnings

Yahoo! (YHOO) is scheduled to release Q1 earnings this Tuesday April 20th, after the market close. Average analyst estimates for the search underdog are $.09/share in EPS and $1.17 billion in Revenue.  Twenty-seven analysts track the stock with no upward EPS revisions in the last 30 days and no downward EPS revisions in the last 30 days. Last quarter, Yahoo! met average analyst’s expectations of .11/share.

I always find this a tough period waiting to see if the company is going meet, exceed, or miss their earnings estimates.  One thing I have discovered of value is to analyze sentiment moves in a stock ahead of the company’s earnings release.  In the case of Yahoo!, I will use the piqqem sentiment index for Yahoo! to see how sentiment has changed in the last quarter, for the months within that quarter, and from the end of the reporting quarter thru today.

 I’m looking for moves or changes that may foreshadow the earning release.  (piqqem leverages the ‘wisdom of crowds’ by allowing its users to vote on the price direction of a stock and then applies its own propriety factors to calculate sentiment for a security. In their model, -100 is the lowest and 100 is the highest sentiment).

Sentiment for Yahoo!

Source Piqqem

Will Yahoo! continue to struggle versus Google (NASDAQ:GOOG) and Microsoft (NASDAQ:MSFT) in search? Or will it find a product niche to dominant similar to eBay (NASDAQ:EBAY)?

The above chart shows Yahoo!’s sentiment rising by 6 pts from their last earnings release thru today.  As a comparison, sentiment for the NASDAQ index dropped 13 pts in the same period, making Yahoo!’s sentiment movement more impressive. On the Piqqem scale, Yahoo!’s sentiment rating of 4.1 is considered a hold and absolute sentiment indicates a moderate quality stock. Only Yahoo! knows their actual results, but current sentiment points to the search underdog delivering uninspiring news on Tuesday.

Disclosure: Disclosures: No Positions