What a crock!
InfoSpace Chopped To 'Accumulate' At Merrill Lynch (INSP)
(NewsTraders.com)-- Believing that InfoSpace (INSP) does not have the upside potential that some may be expecting, Merrill Lynch analysts Virginia Genereux and Henry Blodget today lowered the brokerage's intermediate-term rating on the Internet infrastructure company to "accumulate" from "buy."
The analysts, who noted in a brokerage report, however, that they "do not see significantly more downside," believe that earlier this year the company set expectations for its wireless operations "that turned out to be aggressive."
Commenting on the downgrade, Genereux and Blodget pointed out that InfoSpace still derives most of its revenues from selling content and services to consumer Web sites in the U.S., where growth is slowing.
According to the investment duo, the stock has two key overhangs relating to wireless operations: a lack of deals with the large international carriers and a lack of information about usage levels of the InfoSpace services.
"Until investors get more clarity on these fronts, we would not expect the stock to show significant gains," the analysts stated.
However, Genereux and Blodget believe InfoSpace should hit their fourth-quarter estimates of $67 million in revenue and EPS of $0.02, though they do not foresee upside.
Looking to next year, the pair reduced their 2001 EPS estimate by $0.02 to $0.14 due to the Locus Dialogue acquisition.
InfoSpace's long-term rating from Merrill was left intact at "buy."
Shares of InfoSpace recently changed hands at $12.75, down $0.94, or 6.85% in early market trading. The stock has a split-adjusted 52-week high of $138.50 and low of $10.25. |
