• Wired, Thursday, January 3, 2008 9:45 AM

Is Yahoo acquisition material? The Web giant has seen its market capitalization tumble from $52 billion in 2005 to roughly $33.5 billion today, still few companies could afford Yahoo at the reduced price. Despite being dwarfed by Google in just about every category in which the two companies compete, Yahoo's revenues are still growing, and its co-founders, Jerry Yang and David Filo, are determined to turn around the company's fortunes.

But that hasn't stopped Web industry watchers, citing its languishing stock and revolving door at the top, from buzzing about Yahoo as a prime acquisition target. Major media players like News Corp., NBC and Viacom--always looking to expand their online businesses--would no doubt love to have Yahoo, but they simply don't have $33.5 billion. Neither does Time Warner.

In its quest to best Google, cash-rich Microsoft has become the popular choice to add Yahoo to its growing online division, but Global Equities research analyst Trip Chowdhry still thinks that move is unlikely.

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