NEW YORK (AFP) - If Yahoo appears back in favor, it can thank Alibaba, the Chinese Web giant in which it holds a big stake and that is set for a public stock offering.

Yahoo shares soared 6.26 per cent to close at US$36.35 Wednesday on the heels of a better-than-expected quarterly report, but some were more focused on the Alibaba financial results buried in the document.

"The salient point of Yahoo's first quarter results was the very strong December quarter results from Alibaba," said Jordan Rohan, analyst at the brokerage Stifel.

"Alibaba's results paint a favorable picture for a favorable IPO despite the recent period of weakness in the Internet sector."

The Chinese firm has not yet released details on its finances, but Yahoo's figures showed Alibaba with a 2013 fourth quarter profit of US$1.35 billion on some US$3 billion in revenues. That indicates 66 per cent growth, up from 51 per cent in the past quarter.

The data from Alibaba "gives us decent conviction that the valuation will ultimately be higher than US$200 billion," Rohan said, dwarfing Yahoo's market value of around US$36 billion.

Other analysts say a more realistic value for Alibaba could be in the range of US$130-150 billion.

Yahoo holds a 24 per cent stake in Alibaba and under the latest plans is expected to sell about 10 per cent of the capital in the Chinese group in the initial public offering.

The US firm bought 40 per cent of Alibaba in 2005 for US$1 billion and now stands to reap a handsome profit from that. Yahoo sold part of its stake in 2012, getting a gain of US$7.6 billion.