Benchmark Warns of Sustained Display, Search Share Losses at Yahoo! (YHOO)

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Yahoo! (Nasdaq: YHOO) shares may be under some pressure Wednesday as Benchmark's Clayton Moran made some concerning comments in a research note this morning. The analyst pointed to checks suggesting the company's "display and search segments continued to struggle in 2Q12."

Although Moran said he was "encouraged" by Yahoo!'s actions related to the Alibaba stake, he is remaining on the sideline "due to the likelihood of sustained market share losses." Moran believes Yahoo! is "losing share in online display advertising due in part to its lack of a real-time bidding solution to compete with Google's Ad Exchange. Yahoo!'s technology is not as advanced as Google's, rendering the buying process more complicated for advertisers and agencies."

Benchmark is modeling for growth of about 5 percent in Yahoo!'s display segment, but said this is probably the best cast scenario.

Moran maintains a Hold rating and $17 price target on shares of Yahoo!.

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