from the Wall Street Journal:
Dow Jones Newswires -- April 20, 1998
CNET Shrs Up; Market Sees 'Substantive'Internet Stock
By TED W. KEMP
Dow Jones Newswires
NEW YORK -- CNET Inc. (CNWK) shares climbed as much as 9.1%
Monday as investors continue searching the Internet sector for "substantive stories," an analyst said.
Steven Horen of NationsBanc Montgomery Securities Inc. said the market has decided that CNET, a San Francisco provider of programming and information related to computers and the Internet, was cheap at last week's trading level of about 28.
"The current move is really a function of the fact that it was way oversold," he said.
On Thursday, CNET stock finished at 36, a gain of almost 30% over
Wednesday's close of 27 7/8. On Friday, the shares gained another 3/8.
The shares recently were up 2 5/8, or 7.2%, at 39, on Nasdaq volume of 699,300, compared with average daily volume of 306,700. The intraday high was 39 11/16.
NationsBanc's Horen said CNET is seen as a "substantive" buy in the
red-hot Internet sector primarily because Wall Street expects the company to turn a profit in the 1998 fourth quarter.
A First Call Corp. consensus of eight analysts forecasts CNET earning 12 cents a share in the fourth quarter. For the second quarter, the First Call consensus predicts a loss of 41 cents a share.
"It has a proven business model and proven value for its advertising clients," said Horen, who also cited the company's favorable
cost-per-thousand-impressions rate, or CPM.
CPM is a pricing model for Internet advertising that measures how much advertisers pay for every 1,000 impressions - or every 1,000 times that an ad is displayed to Internet users - on a Web site.
Horen characterized CNET's CPM rates of $100 for its news.com site and $75 for its cnet.com site as "extraordinarily high."
The analyst suggested that investors scouring the Internet sector see an identifiable valuation in CNET that they can "bolt to earth."
Company officials were not immediately available for comment.
- By Ted W. Kemp; 201-938-5392
Copyright c 1998 Dow Jones & Company, Inc. All Rights Reserved. |
