Mortality has proved costly for Yahoo!
However, for those used to rival Google's
Most companies would love to grow the top line by 39% and free cash flow by 31%, but this is Yahoo! we're talking about. The expectations run high, and the valuation multiples reflect that.
For the new year, Yahoo! is looking to produce between $1.4 billion and $1.6 billion in free cash flow. At the low end, it reflects growth of just 8% in 2006. Revenues are expected to grow at a healthier clip -- 24% to 31% higher after accounting for the money Yahoo! kicks back to its search partners -- but that's still off its historical spurts.
This comes at a time when Yahoo! had folks believing that it was ready to jump-start its winning ways. The company been growing its paying-subscriber relationships and recently launched a contextual marketing program similar to Google's wildly popular AdSense.
There was a time when smaller paid-search specialists such as Miva
This may come as a rude awakening to companies like Inside Value pick Microsoft
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Yahoo! Longtime Fool contributor Rick Munarriz is a frequent Yahoo! visitor. He does not own shares in any of the companies mentioned in this story. The Fool has a disclosure policy. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.