NASDAQ: YHOO2/28/2012

Turner NovakMark Blazo

• Buy 100 shares @ $21.31 • $2,131• 4.71% of portfolio

Yahoo Overview

• Founded in 1995• Sunnyvale, CA• 14,100 employees

Yahoo Today

• 2nd largest online advertising platform

• 240+ Million users

• Personalized digital content• Communications, Search, and

Media• Not just a search engine

Yahoo Tomorrow

• New executive team• Hire/Buy talented

employees/programmers

• Transition from media to mobile• Monetize mobile offerings• Improve advertisers capabilities to

create and manage their own ad campaigns across Yahoo’s network

Q4 Earnings Call Takeaways

• Revenue was flat• Earnings up• Lots of excess cash– Continue share buybacks– Continue acquisitions

• Commercializing and monetizing products• Transition from display ads to mobile ads• Just under 200 million mobile users

Q4 Earnings Call Takeaways

• Currently 75 mobile apps– Reducing to “about 12”

• Remodel the 12 apps that will stay in the portfolio

• Continue acquiring companies between $10 - $100 Million to buy talented programmers

New Management TeamCEO - Marissa Mayer• Google’s 20th employee• VP of Search Products, User

Experience, Local, Maps, and Location

• Developed Google’s Search and Contextual Discovery

• Very involved in hiring new Google employees• Part of 20 acquisitions at Google• Programmer – Unlike previous Yahoo CEO’s

New Management TeamCFO - Ken Goldman• Three decades of experience in

software and internet companies• History of fiscal discipline and

internal controls

COO – Henrique de Castro• Brought in to repair Yahoo’s

relationship with big ad agencies• Built Google’s display advertising

business from scratch• Monetized Youtube

New Management TeamVP of People – Jackie Reses• Experience in Private Equity investing in

media and technology• Training and development of new employees• Firm grasp of acquisitions through PE

experience

CMO – Kathy Savitt• CEO of Lockerz• CMO of American Eagle• VP of Amazon• In charge of worldwide

marketing and branding

Institutional Ownership

• Greenlight Capital, David Einhorn– Predicted the downfall of Lehman Brothers– Exposed accounting and inventory problems at

Green Mountain Coffee Roasters– First to discover disclosure changes at Herbalife

• Third Point Capital, Daniel Loeb– Exposed previous Yahoo CEO resume blunders– Pitched for Mayer to become new CEO

Strategy for Growth

• Not moving away from media completely • Media Technology company• Tangible products, not just a website• Integrate products with users lives• Increase search market share• Bring in talented employees– Acquire small, “failed startups” with talented programmers

Current App Portfolio

Flikr vs. Instagram

Investments in Other Companies

Yahoo’s Value

Core Business21.44 x 29.6% = $6.35 per share

13.2 11.7 3.1 + 1.629.6%

Yahoo’s Value

• Bought 40% stake in Alibaba (Chinese Amazon) in 2005 for $1 Billion– Sold half of it for $7.6 Billion in 2012

• Remaining stake is valued at $7.6 Billion at current Total valuation of $38 Billion

• Projected IPO by the end of 2014• Expected to be valued up to $150 Billion

Yahoo’s Value

Risks

• Strategic search alliance with Microsoft• No operating system of its own– Not necessary for apps

• Many different platforms/apps make it difficult for Yahoo to appeal to advertisers– Lowering number of apps

• Yahoo is a tech company– Also a media company

• Capable management team in place

• Cash available to spur growth• Mobile use globally will

continue to increase– There is no clear “Apple” of

mobile products– Will it be Yahoo?

Investment Thesis

• Buy 100 shares @ $21.31 • $2,131• 4.71% of portfolio