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Technology Stocks : DRIV (DIGITAL RIVER). Get in on internet IPO.
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To: Thomas DeMille who started this subject1/2/2002 9:24:47 PM
From: david james  Read Replies (1) of 3198
 
Prudential comments, from the bottom of the following link

multexinvestor.com

That Digital River Is A Hidden Jewel. This small-cap company is a gem, in our view,
providing e-commerce outsourcing capabilities for software publishers and nondigital
manufacturers, distributors, and retailers. Investors became reacquainted with the story during
this past year, as the stock price increased 502% from January 1 through November 23, 2001
(versus a 17% decline for the Nasdaq). We believe Digital River (DRIV—$17.56; rated Buy and
high risk) is well-positioned to continue benefiting from two software industry megatrends:
1) the migration of software sales to the online medium, and 2) software publisher
disintermediation of the retail channel.
We Also Like DRIV Because Of The Leverage In Its Business Model. Specifically, the
company has already achieved long-term gross margins in the range of 78% to 83%. We
forecast DRIV will achieve cash profitability in the fourth quarter of 2001, and believe the
company can achieve long-term operating margins of 30%-35%. We expect the company will
grow revenue close to 50% in 2002 and achieve pro forma EPS of $0.38. In our opinion, 2002
will be the year in which investors fully realize DRIV’s impressive growth opportunities and
operating leverage, and value DRIV accordingly.

The senior analyst has material positions in EBAY and DRIV
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