How Bad Could Yahoo!'s (YHOO) Quarter Be?

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Jerry Yang and other Yahoo! (NASDAQ: YHOO) management have said that the portal company will make its forecasts for Q1 08. But, those numbers fall within a range and are not based on a single set of figures.

Wall St.’s consensus forecast, based on 27 analysts polled by First Call, is a figure of $1.33 billion (excluding traffic acquisition) in revenue, up from $1.18 billion in the same quarter a year ago, But, the low estimate among the group is $1.29 billion. The EPS consensus from the group is $.11 compared to $.10 in the 2007 quarter. The low estimate from the analysts is a mere $.07.

Yahoo!’s own forecast for Q1 is for revenue (excluding traffic acquisition) to be in a range of $1.28 billion to $1.38 billion. If EPS is calculated on the same basis as in Q4 07, using 1.395 billion shares, at the low end of Yahoo! revenue forecast, EPS could certainly be well under $.10. Yahoo! did not issue an EPS estimate for either Q1 or the full-year of 2008.

Yahoo!’s numbers could fall within the range of its own forecast, and Wall St.’s, and still be a disaster.

Douglas A. McIntyre