To compare, first adjust share price for shares outstanding. Yahoo has 3x as many, thus Goog would trade at $280. That moves its EPS down to $11 per share from $33 per share. IF Yahoo was equal to only 1/4 of Google (and the EPS suggests it should be more like 30%), then Yahoo could be trading at $280 x 30% or $84 per share. The moment Marissa shows revenue growth even without the profits catching up initially, Yahoo will take off. It is a matter of time and Yahoo will make a very significant run. Those catching this ride are buying their tickets today.
Yahoo is 1/10 of Google. This management team will close that gap . . . and, at least, in the short term, the expectation that the gap WILL close will make many bet now while the betting is cheap. On speculation alone the market cap of Yahoo will soon be 1/5 of Google's . . . that puts the stock in the low $40's . . . . the unknown that Alibaba offers will aid in the stock appreciation well before Alibaba does IPO. Way too many favorable speculative factors to not think this gap will narrow and soon. Yahoo will be a bigger player in the short term . . . how soon before the completion of the stock buy back is announced?
It looks like Apple and Google will move market cap dollars to Yahoo. The inevitable volume shift coupled with fewer shares for sale with the buyback, and you sense a movement in Yahoo that has been pent up for a long time. Yahoo market cap can easily be $80B.
As one observes the relationship with Google, the mkt. cap potential and the share adjusted comparison . . and Ms. Mayer and company . . . it is very difficult to not see Yahoo in the $70 range over the next 12 months. A huge move, yes, look at AAPL over the past year . . . just know the potential is there and it begins here . . . play not, gain not.