Dronamraju Ravi Prakash

In the past i have always compared relative valuations of GOOG, YHOO on this blog. I haven't posted much after i sold GOOG @300, regarding this. These last 5 months have been quite a bit of roller coaster for both these stocks. I thought it made sense to compare the current value being assigned to both companies.

Aah, it seems to me that YHOO is trading at a significant discount to GOOG. What does it mean? Does market really believe that GOOG prospects for 2006/2007 are that much better than that of yahoo? Are they not factoring in the value of yahoo japan ? If the market is worried that search industry is slowing down, YHOO is much better insured for that than GOOG. Am i missing something here?

I tried to look up estimates for GOOG/YHOO for 2006 and 2007 on Yahoo finance. These numbers seem to be stuck in 2005. I am guessing that they are showing 2005 estimates for 2006 and 2006 estimates for 2007.

Is YHOO better value or is it that GOOG is a better growth engine? I guess all the future numbers are estimates and in case of GOOG, estimates with no guidance from the company. But, it would have been good to have some good earnings estimates for both YHOO, GOOG to do a bit more comparision.