Great potential
by: asdskicker 12/21/1999 7:52 pm EST
Msg: 245 of 252
Funny how you can pick a great stock, only to watch it get passed by. I can't count the number of times that has happened to me, while the big names just keep rocking. Thankfully, a little bit of patience is rewarding, since most disparities resolve quickly.
ASD doesn't have anything unique or exciting going for it. In fact, many businesses have implemented tools that allow them to sell online. Even the name is kinda dull. But what makes ASD so appealing to me is that it can not only support the big and middle sized companies it currently has, but that it is ideally positioned to support the start-up, small, or "virtual" businesses -- and there's a lot more of these shops than most people realize. Plus, it allows these smaller players the ability to focus on what they do best, instead of spending a ton on e-commerce, warehousing, shipping, or other distribution systems. Heck, they can even provide call center support. It's a compelling solution, and it's robust enough for EDS, Sears, and Toys R Us. This is not a fly-by-night operation. I've tried out their systems on the retail end and have been very impressed. My goods were picked and delivered within 48 hours. And this technology is available on a fee-for-service basis. Wow.
There's no-one else out there that is doing exactly what ASDS is doing. Andy Grove (Intel fame) has predicted that the companies that don't go online soon will be gone in a few years. After this Christmas, a lot of businesses are going to realize this, and ASD stands to pick up a lot of business, long term.
Their pricing model is sound. It builds loyalty and long-term revenue streams, but also shelters ASD from the razor thin margins e-retailers have to contend with. ASD gets paid, even if sale is a loss leader, and the last time I looked, the web wasn't a great place for high profit margins. Traffic is key.
Analysts have already pegged this stock at $35. Given the valuations given to some of the other B2Bs in the last few weeks, I think this is extremely conservative. The resistance at current levels (still well above the IPO price) indicate most investors are waiting for substantially higher returns. It's hard to sit on the bench on a day like today, but I think we'll be in the game pretty soon.
Cheers. |
