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Yahoo! Earnings Boost Market

Internet stocks were having their best day in recent weeks due to strong first quarter earnings from Yahoo! and investor optimism spreading back into the business-to-business e-commerce sector. Analyst activity was playing a major role in the resurgence.

By noon Eastern, internet.com's Internet Stock Index was up 34.60, or 4.03 percent, to 892.14, the NASDAQ composite had jumped 128.73 to 4,297.95, and the Dow Jones industrial average was up 109.21 to 11,143.13.

Shares of Yahoo! (YHOO) were down 5-15/16 to 159-5/8, despite reporting better than expected earings for its first quarter of the year. Yahoo's earnings before unusual items amounted to $63.3 million, or $0.10 per diluted share, beating analyst earnings-per-share (EPS) estimates by a penny. The company reported revenues of $228.4 million, beating the consensus estimate of $205 million. It's interesting to note that Yahoo! has now beaten consensus EPS estimates for 16 straight quarters. In addition to the earnings call, Yahoo also named Susan Decker, the former global head of research at Donald, Lufkin & Jenrette, as its new chief financial officer. Decker replaces Gary Valenzuela, who will retire this summer.

WebTrends Corp. (WEBT) was up 2-1/2 to 68-3/4. Merrill Lynch initiated coverage with a "near-term accumulate" and "long-term buy" rating. In addition, internet.com analyst Tom Taulli featured WebTrends in his Morning Report.

Internet Capital Group (ICGE) had gained 4-63/64 to 78-11/16, VerticalNet (VERT) , +7 to 62, Onvia.com (ONVI) was up 3 to 16-1/16, and Commerce One (CMRC) had jumped 11-3/4 to 124-1/4.

Salomon Smith Barney initiated coverage of Priceline.com (PCLN) with a "buy" rating and $130 price target, eBay (EBAY) with a "buy," $225 target, and Amazon.com (AMZN) , "buy," $130 price target. Shares of PCLN were up 3-21/64 to 75-17/64, EBAY + 6-1/16 to 172, and AMZN +13/16 to 63.

Jupiter Communications (JPTR) was rocketing 8-15/16 higher to 31-3/16. The online research firm announced that it expects revenues of $16.5 million for its fist quarter, representing a 175 percent increase from the same period a year ago. Jupiter attributes the growth to increases in contract value and strong revenues from its conferences.


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