Shares of Homestore.com, Inc., popped higher on Tuesday after the online real-estate web site was lauded by Goldman Sachs.
The report elevated the real estate marketplace’s rating from Market
Outperform (MO) to Recommended List (RL).
The reason for the improved rating is attributed to Homestore.com’s
“consistent growth via strong fundamentals as the clear market leader; three
diverse revenue streams that provide solid visibility, ‘limited’ economic
experience and significant upside potential; and benefits of significant
lifetime value of subscribers further supports an increasing value
proposition of the platform,” according to the GS report.
The report additionally cites that Homestore.com has shown six
consecutive quarters in which it exceeded estimates, a 34 percent compounded
quarterly growth rate in revenue over that period, cash break-even in in
third quarter 2000 and a 4 cent increase in earnings per share for the
fourth quarter of last year.
“Revenue per subscriber has increased to $1,144 per year from $481 per
year in 1999, with subscribers growing to 145,000 in fourth quarter, 2000,
from 63,0000 in first quarter, 1999,” the report noted. “Homestore has three
times the listings and traffic of its nearest competitor and garners 64
percent of eyeball minutes in the category.”
At press time, the company’s stock was trading at 31 63/64, up 5 3/64, an
18.74 percent change.
Homestore.com’s family of sites includes REALTOR.com, HomeBuilder.com,
HomeFair.com and CommercialSource.com.