Thanks, Iqbal...as usual, for a thorough response.
Interest rate risk, currency risk...an IB identifies a new one ISP risk! fwiw:
clearstation.com
Analyzing a sample of consumer ISP stocks, including among others EarthLink (ELNK), OneMain.com (ONEM) and Prodigy (PRGY), the analysts found that despite solid quarterly results in June, the valuations of companies sampled are down an average 48 since mid-April. "While we recognize that interest rate fears and other factors drove valuations down, we believe ISP-specific risks are also depressing valuations," write Prince and Burke. Those risks include competition from free ISPs and factors related to broadband Internet access. "Competition from free ISPs will put pressure on dial-up access rates and contribute to greater segmentation of the consumer ISP market," the analysts say. Their conclusion: "Positive news may generate short-term trading opportunities over the next few months, but we do not expect a sustained rally until the impact of industry risks is clearer."
Nancy |
