Yahoo! Inc. (YHOO): Why It Is Becoming a Prudent Long-Term Bet

Nonetheless, it remains a hypothetical question whether or not Yahoo! Inc. (NASDAQ:YHOO) succeeds in challenging Google’s dominance in the near future. But, at this moment, nobody can deny the fact that Google is among one of those tech companies equipped with facilities which will see the company grow even faster. With an employee base of around 54,000 and the market capitalization of $266 billion, the internet giant is looking all set to continue its dominance in the IT segment.

On the other hand, Facebook has to play all tricks to retain its one billion users to keep using the social networking platform on a regular basis, which seems a daunting task from a long-term perspective. On the innovation front, the social media giant has been developing innovative products like graph search and others. Overall, Facebook has got complete control over its acts, at least this point of time.

From a strategic point of view, the Summly deal seems to be an extraordinary move by the company. In fact, it might prove to be the most prudent $30 million deal made in the last few years by any tech firm in the Silicon Valley. CEO Mayer is too much focused on developing solutions for smartphones and tablets so that content browsing can be simplified.

Conclusion

Yahoo is expected to continue acquiring start-ups and add to its core values. It remains cautious on going for research and development on its own, considering it a waste of money. It is to be seen how this move helps the firm in its bid to turnaround; but from the financial standpoint, it will certainly boost its health. Keeping in view the latest developments and its future course of actions, investors can look at it from the long-term perspective.

Jeremiah Feliciano has no position in any stocks mentioned. The Motley Fool recommends Facebook and Google. The Motley Fool owns shares of Facebook and Google.