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to the credibility of online reviews, 4) Instant Book transition puts pressure on revenue growth, and 5) mobile monetization headwinds. Upside risks to our price objective are: 1} improved mobile monetization 2} major OTA sign on for instant booking 3) high non-hotel shopper dollar capture and 4) improved global macro environment. Trivago NV (TRVG) Our PO of $15 is based on a 3.5x 2018E EV/Sales multiple. We note that 3.5x is roughly in line with the lead generation peer group average 2018E EV/Sales multiple. We think our EV/Sales multiple is warranted as a balance between Trivago's higher growth and lower profitability. Our price objective is supported by our DCF analysis. Downside risks to our price objective are: 1) Growing competition, 2) Elevated marketing spend, 3) High Customer concentration, 4) Macro and FX risks, and 5) Potential for loss of hotel inventory. Twitter (TWTR) Our $14.5 price objective is based on 12x our 2018 EBITDA estimate, which reflects a discount to the online media group (13x). We believe the Twitter platform has slowing user and revenue growth and as such, we expect the stock to trade at a sustained discount to online media peers, with potential M&A adding some offsetting downside support. Downside risks to our PO are: 1) decelerating user growth that may raise concerns on long-term revenue opportunity, 2) pressure on usage due to emergence of competing services, 3) new ad initiatives may not perform well, resulting in lower advertiser demand for Twitter ads, 4) monetization of logged-out users and third party application users are slow to materialize, and 5} on a EV/EBITDA basis Twitter is more attractive today than in the past, but stock remains subject to multiple compression. Upside risks to our PO are: 1) User adds could ramp on new product initiatives in the 2H, and accelerating user growth may increase optimism on long-term revenue opportunity, 2) with new demographic targeting initiatives, Twitter is able to capture more TV dollars (vs online ad dollars) that are incremental with video ads, 3) the NFL broadcasts and other video content (live political, entertainment, etc.) could help Twitter grow users meaningfully in the long term, 4) guidance could prove to be conservative, 5) traction from monetization of logged-out users and 6) potential that Twitter could be acquired. Wayfair (W) Our price objective of $44 is based on 0.7x 2018E EV/sales. We continue to focus on EV/Sales given Wayfair's lack of profitability to date. Our 0.7x target multiple is a discount to W's eCommerce comp group and at a modest discount to W's retail comp group. We think the multiple is appropriate given stronger revenue growth vs. peers, balanced by lower profitability and competitive risks. Downside risks are: 1) GAAP operating losses expected through 2018, making valuation analysis more complex, 2) competition from several well capitalized companies including Amazon, 3) brand complexity (5 brands), 4) category limitations, 5) partner segment revenue headwinds, and 6) execution risk on International expansion. Yahoo! (YHOO) Our price objective of $57 is based on our sum-of-parts valuation assumptions. Our $53 estimated asset value represents $39/share from the remaining Alibaba stake (using $122 Alibaba valuation {10% discount rate, mid-term FCF FY18-25E CAGR of 18%, 4% terminal growth} x 384mn shares at 20% discount rate), $6.1 for Yahoo Japan, $0.5 for Excalibur patents, and $6.9 in cash and cash equivalents on Yahoo's balance sheet. We 58 _Internet/e-Commerce | 06 April 2017 Bankof America <2 Merrill Lynch HOUSE_OVERSIGHT_014944