from briefing today:
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10:23 ET ******
Inktomi (INKT) 89 3/16 +4 7/16: Like just about every other Internet stock, Inktomi has been beaten down nearly 50% from its high. But with the announcement of a new product and a friendly brokerage firm recommendation today, it is on the mend. INKT unveiled its new Directory Engine product, which will categorize Internet content by topic. Yahoo! (YHOO) is arguably the leader when it comes to categorized search results, with most other search engines returning results based on keywords without regard to whether the returned pages fall into a category relevant to those keywords. Not only are categorized search results often helpful to users, they are also profitable for INKT's clients, which can charge advertisers more for ads that are targetted to specific categories. With this product, INKT significantly broadens its offerings to Internet portals. Friedman Billings initiated INKT with a "buy" this morning and a 12-month price target of $130. Though well below the Aprill 11 high of $159 1/8, those old highs in the Internet sector should probably be ignored when putting new money to work. Given the current volatility in the sector, we are recommending that investors steer clear of Net stocks until the dust settles. When it does, INKT will be one of the companies worth a look. Its business model falls into two of the more compelling categories recently defined by Briefing.com: the "transactional slice" and "infrastructure suppliers." Both are inviting -- as an infrastructure supplier, INKT benefits from overall Net growth without worrying about its brand recognition among consumers, and its transactional slice approach to pricing is highly leveraged. INKT is expected to approach break-even in FY00 and it could explode into profitability thereafter.
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