Do It Yourself Stock Investor

Saturday Night RORC: Yahoo! Inc.

March 12, 2016

This past week held the celebration of International Women's Day. Marissa Mayer was frequently referenced due to her business influence as the President and CEO of a leading technology company. Since July of 2012, Yahoo! Inc. (NASDAQ: YHOO) has been under her leadership and as of late, the object of scrutiny.

Yahoo PPS Chart

They have lost the search engine battle multiple times. As a news outlet, it has struggled in the crowded space. The Return on Research Capital (RORC) has declined approximately 22% since 2013.

The company serves as a reminder to how the metric can be one dimensional. Though the core business has struggled, Yahoo! managed to profit in 2014 due to selling its assets in Alibaba Group Holding (NYSE: BABA). The strategic investment portfolio has propelled the company away from its core business.

The following is a look at 2015 RORC for Yahoo! Inc.:

Saturday Night RORC: Yahoo!

Per the RORC metric for Yahoo!, one R&D dollar spent in 2014 resulted in $4.12 in gross revenue for 2015. When compared to some online tech peers, IAC/InterActiveCorp (NASDAQ: IAC) outperformed with its, and to name a few. Yelp Inc. (NYSE: YELP) ranked second in comparison.


Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.