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Yahoo’s Grand Plan

Tech watchers have their eye on the next big thing that could move the market Friday and whispers are swirling that it will come out of the Yahoo! shareholder meeting.

“While it will hardly be the showdown it could have been, the drama will still be palpable,” writes CNBC’s Jim Goldman in his blog Tech Talk.

The big news is that activist investor Carl Icahn, who ran a heated proxy battle to unseat the Yahoo board and oust its chief executive will not be attending.

“But that doesn't mean they've pushed their differences aside, or that general shareholder bitterness doesn't remain,” Goldman says. “This is still a company on the ropes, still a company having its hat handed to it by rival Google.”

So what should you expect out of the meeting? For insights we turn to Thomas Weisel Partners analyst Christa Quarles.

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What Will Yahoo! Say: Christa's Predictions

- Puts Microsoft Deal to Bed
- Cuts 3-Year Growth Plan Unveiled in March
- Unveils New Ad Platform Product

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For those of you hoping that Yahoo! and Microsoft will soon reach some kind of agreement, you can see from the chart above Quarles doesn't expect a deal anytime soon.

“You might see something in 2009," she says, "but I’m putting to bed the idea that we’ll see a deal with Microsoft anytime this year.”

"We downgraded Yahoo! a couple weeks ago,” she reminds the traders. Quarles dropped Yahoo! to "underweight" from "market weight" and cut the stock price target to $18 from $28.

In a note to clients Quarles said it could be difficult for Yahoo's stock to appreciate until there is major action as the company relates to organizational hurdles, product improvements and the reacceleration of organic revenue.

On fundamental basis, the outlook remains cloudy at best and potentially could worsen. "They’ve lost about 140 executives over the last 6 to 8 months. There has been a stream of executives exiting."

In other words, "is it riskier to stay at Yahoo! or go to a start up?” she says “and a lot of executives are choosing the latter.”

And that leads to our Charles Schwab Question of the Day!












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Trader disclosure: On July 31, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Macke Owns (EMC), (DIS), (ATVID), (MSFT); Adami Owns (C), (AGU), (BTU), (GS), (INTC), (MSFT), (NUE); Finerman Owns (GS); Finerman's Firm Owns (MSFT), (SUN), (TSO), (TYC), (VLO), (RIG), (UFS); Finerman's Firm And Finerman Own (C) Leaps; Finerman's Firm Is Short (XLF), (BBT), (IYR), (IJR), (MDY), (SPY), (IWM), (COF); Seymour Owns (AAPL), (CSCO), (F), (MER), (MSFT), (INTC); Seygem Asset Management Owns (VIP), Gazprom; Seygem Asset Management Is Short (RSX)

Thomas Weisel Partners LLC Or Affiliate Expects To Receive/Seek Investment Banking Compensation From (YHOO), (MSFT) In Next 3 Months: Thomas Weisel Partners LLC Or Affiliate Has Provided Or Is Providing Non-Investment Banking, Securities-Related Services To (YHOO), (MSFT) In Past 12 Months And/Or Has Agreed To Provide Services Or Currently Has A Client Relationship

Thomas Weisel Partners LLC Or Affiliate Expects To Receive/Seek Investment Banking Compensation From (MSFT) In Next 3 Months

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