Brk,
Thanks for that. I believe charts are only relevant when they represent a psychological bubble or dip, as they sometimes. However, when a stock is moving for concrete reasons like earnings stemming from favorable developments, I think charts mean very little. Because FWHT and OVER have moved for fundamental reasons, I do not feel they are due for a large pullback. Most notably, OVER is going to experience a HUGE HUGE HUGE boost in income over the next 6 months from this partnership. I am a huge advertiser with them and have seen my clickthroughs jump immensely in just day one. When this becomes apparent to others, I think OVER will hit the 30's. After that, I will have to re-evaluate. Depends on how Yahoo handles things, etc. Yahoo has a huge task ahead of them in developing their own in-house system. It takes hundreds of reviewers for a company their size that will generate so much interest...given that they are cutting back staff in most other areas, I dont see how it makes sense for them to take on this huge challenge from the ground up. I think that is why FWHT rose yesterday a lot...other people may be thinking like me and seeing that Yahoo could buy FWHT extremely cheap relative to OVER's valuation and they could obtain a customer base, listings, staff, technology, and know-how that is already solid for quite a minimal price. FWHT is hugely efficient...the only thing holding them back from pulling in dollars per share is the lack of available big boosts in traffic. If Yahoo acquired and used them it would solve this problem and would yield Yahoo millions of dollars in profit quarterly. The problem with OVER is that they are too big for their britches. While they have higher bids and therefore make more sense for Yahoo's short-term partnership, they are a poor acquisition target because they would be much more expensive and the increase in traffic wouldnt make them all that more profitable because they are not nearly as efficient/streamlined as FWHT. I think OVER's future is extremely bright, but it is as a outsourcing provider of listings, as they currently do for AOL and AltaVista and are temporarily doing for Yahoo. FWHT's future is to be bought out by someone huge like Yahoo or MSN who wants to make them their own to maximize their profits. |
