YNDX: Growth Beyond Russia
As of the most recent look, Yandex owns 60% of the Russian web search market. As impressive as that is, it’s not as impressive as the fact that YNDX is also the world’s fourth-biggest search engine.
But isn’t Russia still an emerging market in terms of web usage? How’d the company get that big right in a market that’s not all that well-developed? How can YNDX stock perform with that kind of lethargic opportunity? The answer is a two-parter.
The first part of the answer is that Russia’s Internet market is more developed than most Western investors may believe. In a survey taken early last year, it was determined that 60% of the Russian Federation’s citizens (74.4 million users) use the web at least once a month, with 40% of those web users living in small towns where Internet access would be presumed difficult to get.
While a fair amount of that usage was to perform basic tasks like checking e-mail or working, 39% of Russia’s web users use the internet to watch movies or listen to music, while 37% of those browsers tap the Internet to socialize. Looks like — as is the case in the United States — the web is now finally a form of entertainment in Russia.
But that’s not all. The second part of the answer is that Yandex isn’t solely focusing on Russia. It’s also getting good traction in Turkey, with other nearby Cyrillic markets in its sights. Though the Cyrillic focus makes it tough for Yandex to compete in markets where search queries are typed Roman-based alphabet characters, that’s also why other search engines have a tough time competing with Yandex where the Cyrillic alphabet is native. Point being, YNDX stock has more going for it than most investors may realize.