All year long there’s been a lovefest for big brands, big bucks and the get
big fast Internet firms. You know the names. Our latest tally of ISDEX ups
and downs for the past week shows some of the “smallbies” bobbing at the
top for a change. Quite simply, as the big brands keep rising we think it’s
getting harder to find value (or justify valuations!).
“Buy small” may
be the new mantra as investors start to see growth in revenue and
users/customers in emerging Internet firms: ad-network 24/7 (NASDAQ:TFSM),
software e tailer Beyond.com (NASDAQ:BYND), ad-network leader DoubleClick
(NASADQ:DCLK), Web-hosting provider Exodus (NASDAQ:EXDS) and renewed
interest in IP communications pioneer/leader Vocaltec (NASDAQ:VOCLF).
It’s notable that flavors of the week in recent weeks seem to have stalled:
Amazon.com (NASDAQ:AMZN), eBay (NASDAQ:EBAY), Broadcom (NASDAQ:BRCM),
and Inktomi (NASDAQ:INKT).
As Christmas approaches and Internet users who are eager
to avoid the crowds point and click their way to instant Santa Claus-dom,
we’ll be keeping a closer eye on anything that enables the magic of
couch-potato shopping, such as e-tail stocks like AMZN, and CDnow
(NASDAQ:CDNW).
| ISDEX ( | 03-Nov-98 | % change | |
The Internet Stock Index | close | from | |
27-Oct-98 | |||
ISDEX | 171.24 | 6.5% | |
NASDAQ | 1,788.43 | 4.1% | |
DJIA | 8,706.15 | 4.1% | |
24/7 | TFSM | $17.38 | 74% |
Beyond.com | BYND | $11.00 | 52% |
Doubleclick | DCLK | $34.38 | 37% |
Network | NSOL | $64.88 | 31% |
Open | OMKT | $7.88 | 29% |
VocalTec | VOCLF | $8.63 | 25% |
Exodus* | EXDS | $32.44 | 24% |
ISS | ISSX | $31.44 | 17% |
CKS | CKSG | $22.00 | 16% |
Egghead.com | EGGS | $8.25 | 16% |
Yahoo! | YHOO | $142.13 | 15% |
Spyglass | SPYG | $14.88 | 14% |
Security | SDTI | $11.50 | 14% |
USWeb | USWB | $16.63 | 13% |
Network | NETA | $43.94 | 12% |
Earthlink | ELNK | $43.25 | 11% |
Broadcast.com* | BCST | $50.00 | 11% |
CMG | CMGI | $60.00 | 9% |
Open | OTEXF | $13.50 | 9% |
Lycos | LCOS | $41.50 | 9% |
America | AOL | $132.50 | 9% |
Amazon.Com | AMZN | $126.06 | 8% |
E*TRADE | EGRP | $18.88 | 6% |
Broadcom* | BRCM | $81.81 | 5% |
Broadvision | BVSN | $17.50 | 5% |
IDT | IDTC | $17.38 | 5% |
Security | SONE | $18.00 | 4% |
Cisco | CSCO | $63.38 | 4% |
GeoCities* | GCTY | $34.25 | 4% |
Verisign* | VRSN | $31.00 | 3% |
CyberCash | CYCH | $8.47 | 3% |
N2K | NTKI | $5.81 | 2% |
CheckPoint | CHKPF | $23.75 | 2% |
eBay* | EBAY | $84.00 | 2% |
Axent | AXNT | $23.75 | 2% |
Concentric | CNCX | $24.88 | 2% |
Mecklermedia | MECK | $28.44 | 1% |
Excite | XCIT | $38.13 | 1% |
RealNetworks | RNWK | $37.00 | 1% |
Sportsline | SPLN | $15.50 | 1% |
CDnow | CDNW | $8.25 | 1% |
PSINet | PSIX | $14.75 | 0% |
Inktomi* | INKT | $83.31 | 0% |
Netscape | NSCP | $23.63 | -1% |
Mindspring | MSPG | $38.88 | -3% |
Infoseek | SEEK | $29.63 | -5% |
CNET | CNWK | $39.63 | -6% |
@Home | ATHM | $43.00 | -7% |
Onsale | ONSL | $16.00 | -20% |
Verio* | VRIO | $14.25 | -21% |
* | |||
(c) 1998 Mecklermedia, Internet.com | |||
Among the more notable news behind the moves:
third-quarter revenue, up an amazing 306% vs. 3Q97. On a GAAP basis, 3Q98
net loss is $0.90 per share, including $20.5 million of merger- and
acquisition-related costs (shop comparison engine Junglee, Movie Database
and some smaller book sites in Europe). Cumulative customer accounts climb
to 4.5 million as of September 30, up 377% vs. a year ago.
Repeat orders = 64%, again a strong sign of Amazon’s “stickiness” with
customers. In short, Amazon looks like it may be on its way to becoming the
Web’s most powerful retailer bar none. The real challenge is creating the
infrastructure to enable it. It’s probably 20% there by our reckoning, (books
and music are two of more than 100 categories it needs to capture to be a
truly deep retail experience). A lot can go wrong in the 80% to go. If
successful, however, Amazon could be one of the Web’s all-time wow stories.
So far so good.
largest advertising commitment on the Web ever with a $90 million ad
agreement from First USA, a credit card lender. Term is for five years.
revenue, up 129% to $19.2 million vs. 3Q97. Net loss surprisingly tame at
$2.6 million or $0.08 loss per share. Results include $1.4 million
merger-related costs associated with the pending Disney-Starwave-Infoseek
combination. Pro forma the agreement, Disney will own 43% of SEEK with
options to acquire as much as 50.1% at a price no higher than $50 per share.
The result of the team up will be evident in the soon-to-debut GO.com,
which by combining Infoseek and Disney.com/ESPN/ABC.com will instantly become
the third most visited site on the Web behind Yahoo and AOL, according to
stats from audience measurement outfit RelevantKnowledge.
a doppler effect following its strong third-quarter results announced
October 21. Beyond’s 3Q revenues reach $9.7 million, up 102% vs. 3Q97 while
loss for 3Q98 is $8.9 million. Beyond sells software via the Internet.
the day up 11% to $145.4375 per share. We attribute it more to investors
going with the market leader than any one news item today. The deal
announced with Dow Jones for a job search, for example, isn’t front
page stuff in our opinion and not the caliber of deal to prompt an all-time
high.
As we said earlier, we think Yahoo holds an enviable
category leader status.
interest, up 16% to $62 per share today. Late last week it launched
WorldNIC Japan with ASCII in Japan. Ironically, Prudential downgraded NSOL
last week. NSOL is one of my top 10 to watch for 1998 and my belief is
simply this: as the default registrar, even with competition coming,
Network Solutions has a substantial lead over any possible challenger.
retired on our radar, announces a patent for cover the selection of items to
be replaced in a cache when the cache has no free space. While we’re not
clear on what implications this has yet, we consider object-oriented data
manipulation paramount to the Web’s future. Unfortunately, Versant revenues
dropped dramatically to $5.9 million 3Q98 vs. $9.4 million 3Q97 and it may
take more than a patent to bring revenues up to historical levels. We think
heavy competition in objects has taken its toll on VSNT the stock and
Vesant the firm.
your vote now for ISDEX Mutual Fund!
