Is Priceline Back?

One by one, former Internet leaders appear to be making a comeback.

Except for a brief period in 2000, eBay never left. Amazon began its comeback late in 2001, and Yahoo followed a year later.

Priceline , which finally began to take off in the first quarter of this year, drove home its comeback with an exclamation point on Friday, soaring 26% after beating estimates and raising guidance.

Priceline’s earnings of 20 cents a share blew away analysts’ 14-cent estimates, and revenue of $239.5 million topped $230 million forecasts. Third-quarter guidance of 20-22 cents a share exceeded 16-cent estimates. Hotel bookings drove the company’s results, surging 35% sequentially from the first quarter.

About the only former Internet leader that hasn’t caught on with investors yet is AOL , but the online unit of AOL Time Warner is the worst-performing division of what is now a media conglomerate.

eBay could have used some of Priceline’s magic on Friday, as it fell 3% despite stellar results, as investors wanted more upside guidance than eBay delivered.

The broader market soared, perhaps due to speculation that U.S. troops may be closing in on Saddam Hussein. Economic reports were better than expected, but the rally didn’t begin until news outlets reported that some of Saddam Hussein’s body guards had been captured in a raid.

The Nasdaq surged 29 to 1730, the S&P 500 rose 17 to 998, and the Dow soared 172 to 9284. Volume declined to 1.39 billion shares on the NYSE, and 1.59 billion on the Nasdaq. Advancers led 21-11 on the NYSE, and 18-12 on the Nasdaq. Upside volume was 75% on the NYSE, and 64% on the Nasdaq. New highs-new lows were 143-16 on the NYSE, and 185-10 on the Nasdaq.

Gateway and Advanced Fibre soared on earnings news. VeriSign , Nortel and JDS Uniphase fell on their results, and KLA-Tencor edged higher.

Homestore soared 30% on an expanded partnership with Yahoo .

PeopleSoft edged only 1.7% higher despite Oracle comments that it may offer as much as a 40% premium for the company.

CSC rose 3.8% on a federal e-learning deal.

Microsoft , up 3.4%, overhauled its financial structure.

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