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Politics : Ask Michael Burke

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To: Knighty Tin who wrote (80263)	4/30/2000 3:59:00 PM
From: Spekulatius	Read Replies (1) of 132070

Internet stocks - well Internet have been synonymos for bubble valuations but thats in my opinion not correct any more. The one stick I own, HOOV has 6.6M$ in Revenue (100% growth) and a Market valuation of 110M$, with 55M$ in cash. Gross margin stands at 65%. OK we have got losses, but with a quarterly growth rate of 20% and expenses leveling off, profits are within reach. I also start to like CBS.Marketwatch MKTW Fundamentals look quite bad on the first glance but the bulk of the losses is Goodwill depreciation so its non cash. The mother companies CBS and DBCC will invest 86M$ for stock,so it should have enough cash to last for 2 years. Once those companies can level of their marketing expenses, the fat gross margins could make them extremely profitable and allow them to grow without capital expenses. After all the portals will take over significant market shares from newspapers - so if we compare the value of these online properties with the newspaper stocks the stocks almost appear cheap. I also expect a severe shakeout of the internet stocks, but the survivers should have a good future and I think MKTW and HOOV will be amongst them.

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