Yahoo shares have climbed more than 5 percent over the last month, but there’s still no reason to be a buyer as the Internet company continues to face a handful of problems, said Colin Gillis, senior tech analyst at BGC Financial.
“We’re going to be in a declining-revenue environment in the September to December quarter,” Gillis told CNBC. “We’ve been saying this trade is stuck in a trading range until 2012—[Yahoo] has got to get this search deal with Microsoft sorted out.”
Microsoft and Yahoo agreed to a 10-year search deal in 2009 to better compete against market leader Google , but stopped short of combining their display advertising businesses.
Meanwhile, Gillis has a “hold” rating on Yahoo stock, saying that he expects the firm to “grind sideways” for the rest of the year. He also added that the company’s display revenue growth remains under pressure.
CNBC Data Pages:
Other Tech Giants:
Gillis does not own any shares of Yahoo.