SB, everyone has his or her own way of how to invest. Some are speculative, some are conservative, and some in the middle. I am not saying that this company is not going to make it as a business. My question was, why would you buy a company at $30.00 to $35.00 a pop, with only yearly growth in sales, and no net profit for the past 3 years. I Do not have much time this morning to elaborate on details and the concept. However, here is a quick question. Lets assume ONSL in 1999 will clear a net (12 months) profit of $ 0.60 per share. How much would you pay for the stock $150.00? How much of a net profit do you think "ONSALE" will make in the year 2000? My logic of investing is still valid, why pay so much now!
FLUCTUATION IN OPERATING RESULTS
The Company's operating results have fluctuated in the past, and are expected to continue to fluctuate in the future, due to a number of factors, many of which are outside the Company's control. These factors include (i) the Company's ability to attract new customers at a steady rate, manage its inventory mix and the mix of products offered at auction, meet certain pricing targets, liquidate its inventory in a timely manner, maintain gross margins and maintain customer satisfaction, (ii) the availability and pricing of merchandise from vendors, (iii) product obsolescence and pricing erosion, (iv) significant reliance on various merchandise categories, (v) dependence on relationships with other Online companies, (vi) consumer confidence in encrypted transactions in the Internet environment, (vii) the timing, cost and availability of advertising on other entities' Web sites, (viii) the amount and timing of costs relating to expansion of the Company's operations, (ix) the announcement or introduction of new types of merchandise, service offerings or customer services by the Company or its competitors, (x) technical difficulties with respect to consumer use of the auction format on the Company's Web site, (xi) delays in revenue recognition at the end of a fiscal period as a result of shipping or logistical problems, (xii) delays in shipments as a result of strikes or other problems with the Company's delivery service providers or the loss of the Company's credit card processor, (xiii) the level of merchandise returns experienced by the Company and (xiv) general economic conditions and economic conditions specific to the Internet and electronic commerce. As a strategic response to changes in the competitive environment, the Company may from time to time make certain service, marketing or supply decisions or acquisitions that could have a material adverse effect on the Company's quarterly results of operations and financial condition. The Company also expects that, in the future, it like other retailers may experience seasonality in its business. Due to all of the foregoing factors, in some future quarter the Company's operating results may not meet or exceed the expectations of securities analysts and investors. In such event, the trading price of the Company's Common Stock would likely be materially adversely affected. In addition, the Company expects to experience substantial quarterly net losses through at least the first two quarters of 1999. |
