Merrill Lynch Predicts Growth In Branded Revenue

Despite a predicted slowdown in growth for Q4, 2006, brokerage house Merrill Lynch is predicting overall growth for online giant Yahoo! in the coming year. This, thanks in part to the recent buying habit of the company.

by Kristina Knight

The addition of the Panama search platform as well as Right Media and AdInterax’s ad buying and selling platforms hasn’t had enough time to effect Q4, but are expected to have a big impact next year.

According to brokerage firm Merrill Lynch, Yahoo! will grow only 20% in Q4, that is down from 40% growth in Q4 2005. However, the firm estimates that Yahoo! will grow 21% in branded revenue alone next year, thanks in part to the recent acquisition of Right Media.

Analyst Justin Post said (via MediaPost), "Our industry contacts indicate that Yahoo's premium inventory remains a differentiated market for quality conscious advertisers, which we think should provide a competitive buffer that will enable Yahoo to continue to increase CPMs.”

The addition of Panama, their paid search platform, will also induce growth. Panama is expected to be responsible for approximately 14% of Yahoo! growth in the third and fourth quarters of 2007.

Merrill Lynch estimates Yahoo! will see a 6% increase in page views and 8% growth in premium inventory monetizations. They also predict 32% page view growth overall and 31% monetization increase overall.