I just hope the following Solomon's analyst is right.
I talked to companies IR and they seem to be in denial and don't want to address the issue.
--SUMMARY:--DoubleClick, Inc.--Online Media DoubleClick share price is under pressure on concerns related to CMGI's consideration to acquire AltaVista. Worry surrounds the possibility that CMGI might terminate Alta Vista's relationship with DCLK. ** 1) CMGI is not in talks to acquire Alta Vista for $2-3B so that it can acquire a client for Engage and AdSmart. ** 2) CMGI's investment portfolio companies are not as operationally intertwined as this thinking suggests. ** 3) Most importantly, the contract between DCLK and Alta Vista is a 3 year, non- cancellable contract. ** We continue to be strongly bullish on DoubleClick and would take advantage of any material weakness to accumulate the stock. Look for a strong revenue number in 2Q99, continued client wins and a clearer picture of the merits of the Abacus Direct deal to provide catalysts over the next six months. --EARNINGS PER SHARE-------------------------------------------------------- FYE 1 Qtr 2 Qtr 3 Qtr 4 Qtr Year Actual 12/98 EPS $(0.16)A $(0.14)A $(0.14)A $(0.13)A $(0.57)A Previous 12/99 EPS $(0.13)A $(0.12)E $(0.10)E $(0.06)E $(0.41)E Current 12/99 EPS $(0.13)A $(0.12)E $(0.10)E $(0.06)E $(0.41)E Previous 12/00 EPS $N/A $N/A $N/A $N/A $(0.08)E Current 12/00 EPS $N/A $N/A $N/A $N/A $(0.08)E Previous 12/01 EPS $N/A $N/A $N/A $N/A $N/A Current 12/01 EPS $N/A $N/A $N/A $N/A $N/A Footnotes: --FUNDAMENTALS-------------------------------------------------------------- Current Rank........:1H Prior:No Change Price (6/24/99).....:$81.68 P/E Ratio 12/99.....:N/Ax Target Price..:$165.00 Prior:No Change P/E Ratio 12/00.....:N/Ax Proj.5yr EPS Grth...:50.0% Return on Eqty 98...:N/A% Book Value/Shr......:N/A LT Debt-to-Capital(a)N/A% Dividend............:$N/A Revenue (99)........:89507.0thous Yield...............:N/A% Shares Outstanding..:39.3mil Convertible.........:No Mkt. Capitalization.:3210.0mil Hedge Clause(s).....:# Comments............:(a) Data as of the most recently reported quarter. Comments............: --OPINION:------------------------------------------------------------------ This is a reprint of the Equity Alert issued earlier this week. DoubleClick share price is under pressure on concerns related to CMGI's consideration to acquire AltaVista. This is a concern to DCLK because AltaVista is a large DCLK client, representing as much as 40% of gross revenue in 1999E. Worry surrounds the possibility that CMGI might terminate Alta Vista's relationship with DCLK. The thinking is that CMGI might favor two other ad solutions companies in which CMGI holds equity stakes: Engage and AdSmart. ### First of all, CMGI is not in talks to acquire Alta Vista for $2-3B so that it can acquire a client for Engage and AdSmart. ### Second, CMGI's investment portfolio companies are not as operationally intertwined as this thinking suggests. CMGI does not mandate that its companies work together, and in fact CMGI is smart enough to encourage its portfolio companies to use the best technologies, whoever owns them. ### Third and most importantly, the contract between DCLK and Alta Vista is a 3 year, non-cancellable contract that specifically anticipates and is binding throughout any change-in-control at Alta Vista. The contract covers ad serving and ad sales on Alta Vista, both of which are handled by DCLK. Inasmuch as CMGI might operate Alta Vista more effectively and aggressively, higher growth at Alta Vista would clearly benefit DCLK. We continue to be strongly bullish on DoubleClick and would take advantage of any material weakness to accumulate the stock. Look for a strong revenue number in 2Q99, continued client wins and a clearer picture of the merits of the Abacus Direct deal to provide catalysts over the next six months. |
