The annual shareholder meeting at Yahoo! (NASDAQ:YHOO) is over. There was no bloodshed, no angry torch-bearing ranters, not even Carl Icahn (who was a no-show, despite his new seat on the company's board).

This should not be mistaken as a sign that the struggling dot-com bellwether can rest easily. Microsoft (NASDAQ:MSFT) may have walked away from its buyout offers, but shareholder expectations remain. They know that Yahoo! passed on Microhoo offers at $31, and temporarily at $33.

When Jan. 31, 2009, rolls around -- the one-year anniversary of Microsoft's original offer -- investors are going to pull up a stock quote on Yahoo!. If it's substantially less than what Microsoft offered, there will be blood, angry torch-wielders, and even Icahn hollering from the inside.

Add it up and this is a surprisingly compelling time to buy into Yahoo!. It's almost a win-win at this point. If CEO Jerry Yang is successful in turning the company around, the stock will prosper. If shareholders demand change and get it, new vision at the top will propel shares higher initially, given the refreshed optimism.

Few see it that way, of course. The stock traded as low as $19.25 this morning. Save for a temporary dip into the high teens back in January, you have to go back nearly five years to find the last time the stock traded that low.

Once you concede that Yahoo! is no Google (NASDAQ:GOOG) -- and will never be Google -- you can begin to appreciate Yahoo! at today's historically low price.

Yahoo! as Frankenstein's monster
Operating profits, free cash flow, net income, and adjusted net income all dipped during Yahoo!'s most recent quarter. Revenue before traffic acquisition costs rose by just 8%, a sorry contrast to healthier gains at Google, Microsoft, and IAC's (NASDAQ:IACI) new media arm.

This is all about as inspiring as a Kevin Costner flick, and it gets worse. Analysts have been talking down the company's earnings prospects lately. Wall Street now sees the company earning just $0.44 a share this year, and $0.55 come 2009. Investors may shy away from paying 35 times next year's profits for Yahoo! when its faster growing competitors command cheaper multiples.

However, roughly half of Yahoo!'s current share price is backed by the value of its Asian investments in Alibaba, Yahoo! Japan, and Gmarket (NASDAQ:GMKT). The company has a reasonable cash mattress, too. In other words, Yahoo! isn't as expensive as its price-to-earnings ratio suggests.

Another factor that may help valuations in the sector is if Microsoft goes on a buying spree. Microsoft's annual report singles out Apple (NASDAQ:AAPL) and Google as the company's biggest threats. It may never be able to compete against Apple on the hardware side, but it knows it has a clean shot at Google on the dot-com side. It just needs to build up its troops. Last year's beefy purchase of aQuantive was nice, but it's really just a matter of time before it begins to sniff around again. Whether it winds up snapping up display advertising specialist ValueClick (NASDAQ:VCLK) or waits for IAC to complete its spinoffs to go after the appendages it covets, Microsoft is not naive enough to think it can topple Google organically.

In other words, even if Microsoft doesn't revisit Yahoo! the way it has in each of the past two Januarys, snapping up neighboring real estate will drive prices in the neighborhood higher.

Heads you win, tails you still win
I guess what I'm trying to say is that even if Yahoo! doesn't do anything fundamentally substantial to improve its fortunes, shareholders may still be rewarded. There are things beyond its control, like Asian market speculation and sector consolidation, that may lift Yahoo!'s stock out of the teens as it sleeps.

And I certainly don't expect Rip Yang Winkle to slumber away during the next few months. There have been too many moving components in the recent wave of executive defections to maintain the status quo. Change isn't an option. It's a necessity. Even the most jaded of Yahoo! bears may concede that a Yahoo! in motion has a better shot of finding a solution than one simply standing still.

So I don't care where you prefer to fish for catalysts. Whether its external factors or internal forces at play, Yahoo! is still cheaper than you think and the future has a fair shot of being brighter than you imagine.

Mr. Market will come around. Yahoo! may be walking a tightrope right now, but between the rope being lowered and the net rising, I think it's actually one of the better risk-reward plays in the online space.

Other recent Microhoo dealings:

Microsoft is a Motley Fool Inside Value recommendation. Google and Gmarket are Motley Fool Rule Breakers picks. Apple is a Motley Fool Stock Advisor recommendation. Take any of these newsletters out dancing -- free -- for the next 30 days and we'll tell you what stocks we believe will put the best bunny hop in your portfolio.

Longtime Fool contributor Rick Munarriz is a fan of Yahoo! and Microsoft but not of bad weddings. Hdoes not own shares in any of the stocks in this story. Rick is part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.