Yahoo! Canada & YPG Extend Ties

Yahoo Inc. ( YHOO - Analyst Report ) Canada has extended its six-year partnership with the Yellow Pages Group (YPG) to enhance search experience for Yahoo users in the country by providing them accurate and detailed business related information.

Yellow Pages Group is a leading local commercial search provider and the largest directory publisher in Canada. The Yellow Pages directory features information on 1.5 million Canadian businesses and serves over 300,000 local businesses through its nationwide sales force of media consultants. The Group also caters to the country's largest national agencies and advertisers through Mediative, its digital advertising and marketing solutions division.

This partnership will allow Yahoo! Canada users to access local search results as well as minute details about local businesses, including hours of operation, photos, videos, ratings and reviews, all based on location. The deal is expected to increase the number of Yahoo users in Canada. This should in turn boost revenue generation, since the number of users it attracts is directly proportional to the ad revenue it generates. We believe that Yahoo! will continue to enter into this sort of partnership in order to expand its online user base going forward.

To perform the search, Yahoo! users will have to log on to www.yahoo.ca, and then click on the Local tab. This will take the user to the customized Yahoo! Yellow pages website that features Yahoo! Canada’s logo and a personalized search option.

Yahoo has come out with better-than-expected third quarter results, with its non-GAAP earnings up sequentially as well as year over year and exceeding the consensus estimate by 11 cents. However, a turnaround in the company’s business still remains a big task for the new CEO, given Yahoo’s declining position in display and search and the monetization issues related to Microsoft’s search platform. Yahoo also lags in several emerging segments, such as mobile, social and the cloud.

However, despite its struggles in the recent past, partnerships of this sort are likely to boost investor sentiment.

Currently, Yahoo has a Zacks #3 Rank (short-term Hold rating). We note that its archrivals, Google ( GOOG - Analyst Report ) , Facebook Inc. ( FB - Analyst Report ) , and Microsoft Corp. ( MSFT - Analyst Report ) also carry a Zacks #3 Rank (short-term Hold rating).