UPDATE: Nomura Initiates Coverage on Yahoo at Neutral, Establishes $40.00 PT

In a report published Wednesday, Nomura analyst Anthony DiClemente initiated coverage on Yahoo, Inc.

with a Neutral rating, establishing a $40.00 price target. According to the report, while YHOO's paid display ad volume has stabilized, price-per-ad continues to decline, driving down display revenue. “We believe the next organic catalyst for the shares is a return to price-per-ad growth. In our view, CEO Marissa Mayer has done an admirable job playing the hand she was dealt, with both morale and product velocity improving at Yahoo! during her tenure,” the report noted. “But with the value of YHOO's stake in Alibaba probably well-understood, we await sustained display revenue growth before becoming more positive.” YHOO closed Tuesday at $41.14.