As Yahoo! Inc. (NASDAQ:YHOO) continues to be tied to the solid performance of Alibaba’s share price, Oppenheimer analyst Jason Helfstein raised his price target for YHOO to $55 (from $48), while reiterating an Outperform rating for the stock. YHOO stock is currently trading at $43.63, down $0.36 or -0.82%.
Helfstein wrote, “We are increasing our price target to $55, from $48, implying 25% upside potential, on the positive move in Alibaba’s share price. We have also incorporated the $4.1B taxable basis of Yahoo! Core, disclosed in the proxy statement, into our analysis. We have no reason to believe at this point Yahoo!’s reincorporation into an investment company provides a tax advantage, but it necessary to comply with securities regulation laws. Our long-term thesis assumes that YJ shares are sold in the open market over the next 12-18 months at a 15% discount, with full tax consequences, that the IP portfolio is sold, and that the remaining BABA stake trades un-taxed at 10% discount to the public share price.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Jason Helfstein has a yearly average return of 9.0% and a 56% success rate. Helfstein has a 12.1% average return when recommending YHOO, and is ranked #176 out of 4158 analysts.
Out of the 35 analysts polled by TipRanks, 15 rate Yahoo stock a Buy, 19 rate the stock a Hold and 1 recommends a Sell. With a downside potential of 6%, the stock’s consensus target price stands at $41.17.