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E-Mailbag Monday: eFax.com, JFAX.com, FTD.com and Ticker Confusion

Hi Tom: What are you thoughts on EFAX.com? It seems to me that they may be on the way down since AOL has signed a agreement to work with JFAX.com.

Thanks -- Joel Staniec

Reply: Wouldn't it be great to have a universal phone number? It certainly would make life much easier. There are several Net companies trying to make this happen, but so far, it has been an uphill battle.

The technology is known as unified messaging, which centralizes all communications, whether phone, fax, cell, email or whatever.

As for JFAX.com (JFAX) and eFax.com (EFAX) , here are how the two compare on a valuation basis:

Companies

Stock Price

Ann. Revenues

Market Cap

   

(in millions)

(in millions)

eFax.com

 $    7.13

 $          & nbsp;  29.00

 $       91.60

JFAX.com

 $    4.75

 $    &n bsp;         4.00

 $     155.90

No doubt, unified messaging will eventually be a reality, but it will be led not by small Net companies, but huge companies. For example, GTE plans to roll-out its own unified messaging service. Also, Microsoft has said it will, too. There is also a well-funded Net company, called Onebox.com, that says it will give away its services.

I do think the AOL deal will ad some support for JFAX. But, I think JFAX.com, as well as eFax.com, will continue to have difficulties as the competition heats up.

Wilting Net Flower E-Shops

FTD.com is expected to go public this week. What do you think about how it will do?

Reply: By all indications, things do not look good for the IPO. In fact, because of investor sentiment, the IPO had to be delayed. Perhaps much of this had to do with the fact that 1-800-FLOWERS.com (FLWS) had an IPO that broke its offering price; that is, it fell on its first day of trading, going from $21 to $18-3/16.

Actually, I would rather focus on 1-800-FLOWERS.com as an investment.

I wrote an article on 1-800-FLOWERS ( Stop and Sell These Roses -- 8/19/99). At that time, the price was at $19-1/2; of course, now it's at $14-5/8.

I still think, though, that 1-800-FLOWERS.com is a bargain and should benefit -- as will many other e-tailers -- from the surge in eChristmas sales.

The company is growing quickly. In its latest quarter, sales increased 37 percent sequentially to $92.2 million. Of these revenues, $57.7 million came from online transactions.

For the next two years, the company expects to show losses (the company has been profitable for the past 20 years). The idea is to grab as much market share online as possible. For example, the company recently announced an exclusive four-year $37 million marketing agreement with AOL.

1-800-FLOWERS.com has also done some innovative things with personalization and one-to-one marketing.

Finally, 1-800-FLOWERS.com has a tremendous brand, which the company has been able to leverage into other products, like gourmet foods, garden products and gifts.

The IPO Transfer

I bought Kana at the beginning of the year (OTC) who changed their symbol to KKRS. Are the people who bought KANA going to have shares in the new KANA coming out?

Reply: Unfortunately, the answer is "no." Although, it definitely would have been great, as KANA (KANA) surged 42-11/16 to 57-11/16 on its first day of trading.

Basically, a change in a ticker symbol has no effect on the ownership of a stock.

Despite this, there have been examples of "ticker confusion." That is, investors will buy the shares of a company that has a ticker symbol similar to the company going public. This is, in fact, what happened to Ticketmaster Online -- CitySearch when it went public.


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