Yahoo Blows Away Google in Time Spent Online But Not On Valuation

As I go over Yahoo (YHOO) earnings data I was happy to see a decent increase in revenues even if earnings disappointed.  However, it does seem that Google (GOOG) looks like the better value.  (According to First Call, Google has a 2007 P/E of 35 vs. 52 for Yahoo).  Then I came across the following blog entry by Jay Meattle at Compete.com:  He shows top 20 US website usage ranked by time spent on line.  MySpace, owned by Newscorp (NWS), comes in first at 11.9%. Second place belongs to Yahoo at 8.5%, four times the amount of time spent on Google (fifth place) at only 2.1%.  These kinds of numbers continue to disappoint me in Yahoo's management who can't seem to monetize such an industry leading position.  My support of shareholder activist Eric Jackson's Plan B to change Yahoo strategy continues as the best way to extract value from Yahoo.

Disclosures and Confessions:  I own Yahoo andplan to pledge my shares to the campaign.  However, if the shares riseabove $35 I'm likely to start selling.  I'm short Jan 2008 35 strikecalls against half my position of YHOO and am also short Jan 2008 30strike puts.  I do not own Google (GOOG) but have traded it (both short and long) in the last two years.  I do not own News Corp (NWS) nor have I traded it in the past two years.

I like Yahoo!.  For years MyYahoo.com has been my browser startup page; I pay to use Yahoo enhanced email; I have over 2000 photos on flickr; I find Yahoo finance to be almost as good as Bloomberg butwithout the $1800 a month price tag; I have  even been using Yahoo'ssearch recently and find it so greatly improved that I don't need Google as much, I have registered websites using Yahoo.

Disclaimer: Nothing in this blog is meant to be specific financial advice or arecommendation to buy or sell.  I do not give investment advice.  Doyour own research.  Do not rely on anything in this weblog to makeinvestment decisions.  I do not log all my trades here. I only describeor mention those that I think might be interesting. Consult aninvestment professional familiar with your specific financial situationbefore buying or selling any security.