Some Big Gainers, Losers in 2000

It’s been a shaky week for Internet stocks, with more sectors losing
ground than gaining, according to numbers from’s Internet
StockTracker e-mail newsletter due out Friday.

However, despite nagging fears of interest rate hikes and bursting
bubbles, Internet stocks as a whole have been up so far this year, with’s Internet Stock Index of 50 companies up 12% since Dec. 31
and nearly 19% in February.

Among the biggest gainers have been Cavion Technologies (CAVN),
up 152%; Terra Networks (TRRA),
up 143%; and WatchGuard Technologies (WGRD),
up 134%.

Cavion, a provider of B2B Internet services for credit unions (there’s a
niche!), surged on strong Q4 earnings announced two weeks ago, while
WatchGuard benefited (along with a number of other security companies)
from the hacker attacks on major Web sites. Terra is seen as the
strongest access provider in the Spanish market.

A number of companies began 2000 with a bang, only to see their stock
prices quickly roll downhill. Venture fund company Internet Capital Group (ICGE)
is down 30% since Dec. 31, and 40% since Jan. 3, when it spiked $30 to
close at $200 per share. (I’ll take a closer look at ICGE in Friday’s
StockTracker Daily after the company issues its Q4 report.)

Natural-language online search service Ask Jeeves (ASKJ),
which enjoyed a love affair with investors last fall, gained 22% to
close at $138 per share in its first day of trading this year. ASKJ
closed Wednesday at 63 5/16, leaving the stock down 44% for the year and
54% since Jan. 3. Even at its current price, Ask Jeeves is valued at 76x
last year’s revenues.

Some of the high-flying e-commerce software stocks have come crashing
down in 2000. Computer equipment B2B player (PCOR)
was down 46% for the year through Wednesday, while (ROWE),
which sells software that allows libraries to order books and
periodicals, has dropped 51%.

Expect several more stocks from this overvalued B2B e-commerce sector to
come down in the next few months.

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