Yahoo! should be sold to another company or broken up, according to analyst Jeffrey Lindsay of Sanford C Bernstein, the global wealth management firm.In a report, Mr Lindsay stated that the recent changes made by the search engine to boost its success, including the purchase of internet advertising company BlueLithium, may not be bold enough.
Yahoo! bought the network last month for $300 million in a bid to bolster its falling profits and compete more successfully with rivals such as Google, whose earnings soared to $1.9 billion in the first half of this year.
Mr Lindsay stated: "To stop the inevitable slide into irrelevance, [Yahoo!'s] management team must consider more radical actions and strategies. Incremental changes to rebuild revenues simply won't cut it this time."
The combined value of Yahoo!'s display advertising, subscriptions business and internet search engine amounts to $30 a share, according to the analysts.
However, if the company was to outsource its paid service to Google, revamp its advertising business further and cut a quarter of its staff, its shares could rise to a value of $45, he added.
Mr Lindsay went on to say that the firm could be broken up into advertising and subscription businesses and its advertising part could be further divided in to display ads - which include video sports and banners - and ads that show up next to search displays.
Yahoo!'s stock has risen by 9.2 per cent this year, compared to a 29 per cent increase in rival Google's shares.
