Yahoo! is trading at an interesting 6.92 P/E and hit a 52 week high of $20.74 on March 4. However, Google and IBM have been outperforming for some time, hitting 52 week highs fairly regularly, and both have excellent employee benefits and more productive employees.
Those investors who see hard line tactics like job cuts and employee crackdowns as good for a stock need to dig deeper into a company’s and its industry’s culture to see if it’s appropriate and productive. Facebook Inc (NASDAQ:FB) may seem awfully generous to employees with this “Baby Cash”. However, the younger workers it needs are in the catbird seat and their generation demands a certain freedom and support. Especially if they can’t expect the lifelong job security common at companies like IBM when it was Big Blue.
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IBM and Google are just much more solid companies. Since IBM became more of an IT and software support company than hardware provider its stock has soared. Over a century old, IBM’s motto is still THINK and they have been at the forefront of global tech all that time. And they don’t THINK face time is as necessary for innovation as 29% of employees telecommute just as large percentages do at Aetna Inc. (NYSE:AET) (47%) and Booz Allen Hamilton Holding Corporation (NYSE:BAH). IBM is trading at a 13.86 P/E with a 1.70% yield and a 1.20 PEG. IBM has more than doubled since its 2009 low.
Google has been on fire, outperforming competitors Apple Inc. (NASDAQ:AAPL) and Amazon.com, Inc. (NASDAQ:AMZN) the last few months, hitting an all-time high of $808.97 on February 20. Their operating margin is 16.61% and they have a 14.80 forward P/E with a 1.27 PEG. If they only had a yield but they do have tablets, Android, search, cloud, and now Google glass.
Facebook Inc (NASDAQ:FB) may be the speculative name here but sentiment grows more positive for them as they approach the anniversary of the IPO. The forward P/E is 34.67. Fool Steve Heller gives good reasons why Facebook may soon be the mobile juggernaut it’s been promising with a strong push into emerging markets.
Yahoo! still generates heated debate over this move with headlines generated hourly. Good news about the stock is falling through the cracks like the analyst upgrade by Barclays to outperform and giving it a $26 price target. With all this swirling around Yahoo! a step back may be prudent until, hopefully Mayer is able to dial this back.
The article Yes To Facebook and These Techs, No To Face Time originally appeared on Fool.com and is written by AnnaLisa Kraft.
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