Razorfish shares rise on tech rally, IBM deal
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(updates with additional analyst comment, stock price)
NEW YORK, June 2 (Reuters) - Razorfish (NASDAQ:RAZF) shares rose
on Friday on a rally in technology stocks and news
International Business Machines Corp. (NYSE:IBM) had struck a deal
with Internet consulting firms, including Razorfish, to provide
technology for firms building wireless Internet services.
Razorfish shares were up 4-9/16 at 20-1/2 near midday on
the Nasdaq stock market. The Nasdaq Composite Index (INDEX:$COMPX) was
up 5.5 percent, or 197 points, at 3779.41.
Under the IBM deal, eight Internet consulting firms will
work with the world's largest computer maker and use IBM
software to help businesses create content and services for
wireless devices such as mobile telephones, a field seen as one
of the next hot trends in the Internet-related market.
"I definitely think it's very important because IBM can
take them into new markets," said David Mahoney, an analyst at
Wit Soundview. "Razorfish definitely has the lead on its other
competitors in wireless. They have a lead in capabilities and
skill set because of their (relationship) with (the Swedish Web
portal) Spray. Scandinavia is ahead of the U.S. so they can
import the technology from Spray and the experience and apply
it to the U.S. once the market kicks off."
Razorfish's European presence -- about 40 percent of its
overall sales comes from the region -- is also significant
because growth in the Internet consulting services in the next
three to four years will come out of Europe, said SG Cowen
analyst Moshe Katri.
Other analysts also said Razorfish's stock looks attractive
at current levels and the overall rally in technology issues
was helping it move off its lows.
"Razorfish originally started as a creative shop that
focused on Web design and branding," Katri said.
"What it's done is buy ICube, which gives it a lot of what
it needs in terms of back-end integration skills, which is very
important considering where we are in the spending cycle on
Internet.
"Most Internet projects include big end infrastructure,"
Katri said, adding that Razorfish was one of the players
involved in Internet consulting that offered a lot of value.
Copyright 2000, Reuters News Service |
