Web Search Stocks Downgraded

Posted on February 24, 2005

The stocks of the top search engines fell on Thursday aftering receiving downgrades from a RBC Capital Markets analyst. Fox News reported that both Yahoo Inc (YHOO) and Google Inc (GOOG) were downgraded because of pricing weakness of in advertising keywords. Ask Jeeves (ASKJ) and FindWhat (FWHT) stock prices also fell.

However, a recent IAB report indicated that sales soared 32% in 2004 and online advertising revenues are expected to increase by 25% in 2005. That doesn't sound weak at all, but some experts have suggested there is growing trend toward online sponsorships and away from pay-per-click advertising.