Excite [XCIT], an exciting stock to own in 1999! Message Board

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Technology Stocks : Excite [XCIT], an exciting stock to own in 1999!

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To: RumKola who wrote (1118)	3/19/1998 12:19:00 PM
From: Brooks Jackson	Read Replies (1) of 3183

Nutty valuation department: fnews.yahoo.com This makes the perfectly reasonable point that current market caps for web stocks average about $50 per "user," which is way too high for freeloaders (most users) who are really a drag on earnings. (XCIT is a little below that too-high average.) And it reasonably adds that merchandise-buying "customers" ought to be worth more. But how much? Warning, you are now entering cyber-fantasyland: "We'd say that "customer" may be fairly valued at $200 on a average 10x revenue multiple (10x this particular customer's outlay for that month). If he or she buys $500 worth in a year then perhaps that customer's "intrinsic" value to investors ought to be $5,000 a year or $417 per month." Now, if I spend $500 a year at the local book store, and their net margin, after all expenses, is (charitably) $100 a year, and they decide to pay $417 per MONTH to get my business... Well, YOU do the math!

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