Yandex (YNDX) is the primary Internet search provider in Russia. Shares have fallen sharply this year with the entire Russian stock market under pressure.
But the biggest catalyst for Yandex pessimism has been the earnings outlook. In the spirit of a picture often telling the story best, below is the Zacks proprietary Price & Consensus chart, which plots annual estimate changes over time against the stock price.
As you can, analysts have become increasingly negative in their earnings outlook over the past year.
There was some bright news in November, but it was quickly discounted as inconsequential in the near-term. Here was a note from JPMorgan analysts last month…
“After almost 3 years Mozilla is changing its strategy in Russia and will now pre-set Yandex as default search on its Firefox browser, replacing Google (GOOG). We view the development as long-term positive for Yandex, but note that the incremental impact on Yandex traffic share is likely to be small, given the success of Yandex’s own browser and dominating positions of Chrome/Android on the Russian browser market.”
The company is profitable and hit a trailing 12-month peak in revenues of $1.393 billion in the most recent quarter. They are also expected to earn $0.95 this year, but that’s down 22.5% from last year.
Until the estimates for Yandex stabilize and start turning back up, it’s probably best to stand aside. Just watch the Zacks Rank. It will tell you when the time is right.
Kevin Cook is a Senior Stock Strategist for Zacks where he runs the Follow The Money portfolio.
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