SunTrust Resumes Coverage On Yahoo

SunTrust resumed coverage on Yahoo! Inc. YHOO Wednesday with a Buy rating and $57 price target.

Analyst Robert S. Peck felt "that while the core has struggled, the market is fully reflecting the weakness in legacy properties while giving little credit to some of the progress made more recently around: mobile, native, Tumblr, search, and video."

Peck noted that his analysts "indicates that after adjusting for Yahoo’s ownership of Yahoo Japan and Alibaba...investors are essentially getting the core Yahoo asset for less than 1x EV/EBITDA."

"We think that while the core of Yahoo remains in turnaround, the risk/reward continues to favor owning shares at this level," according to Peck.

The analyst report noted that risks include "accelerated deterioration in the desktop web business, premiums paid for M&A and difficulty in unlocking value from tax structures."

Yahoo recently traded at $47.72, up 1.36 percent.