Welcome Back, 'Hopper...
Wondered where you'd hopped off to. Wish I'd been
as smart as you on the calls... nice play. But, as
you know, I'm pretty much a stick-in-the-mud, garden-variety
SEEK long. (Yes, and ITVU has been sweet, hasn't it?)
$41...? Hmmmm.
Let's just review where we are:
* Run-up was no doubt fueled by surge in other engines
like CMGI (LCOS's part owner) and XCIT. We got a lot
of hot money trying to chase down the "new thing."
XCIT announced its earnings, which were good by any
measure, then a VC group sells off. Thus, putting
a chill in the air.
* SEEK's historic run-up--did you see the volumes
and note that we were #1 in volume on at least one
of those days?--was also fueled by its purchase of
WBS, a really nifty chat-room community that appeals
to a younger demographic. As Steve Harmon (who I only
occasionally quote when it serves me to do so) pointed
out, the SEEK WBS purchase was a fricking steal of a
deal. More eyeballs. Lots of folks lingering in
the chat rooms. Better for advertisers. Wonderful
development.
* SEEK's run was also marginally fed by the announcement
of its new server product (this area accounting for 6-8%
of last year's revenues.)
* Plus, as you know, on the 23rd after close, we've got an earnings announcement.
So, there's some speculation surrounding that as well.
* Stuff still hanging in the air includes:
1. The state of NSCP negotiations: will seek
pay to play on NSCP's new portal? Will NSCP even have
a new portal? Does SEEK still need NSCP?
2. Remember SEEK's SPO, grossing $40 million?
That money's probably earned some interest this quarter,
don't you think?
3. SEEK wasn't quiet this week. They delayed
their earnings announcement... orginally slated I think
for 4/17. Too much smoke und sturm und drang surrounding
XCIT. Are we being set up for an earnings surprise?
I do strongly think so.
4. I also STRONGLY FEEL that there's another
purchase--maybe another online community--sitting out
there in the news pipeline. This is just a feeling.
A hunch. Rank speculation.
5. Is there a perception among the serious
institutional investor crowd that the search engine
"story stocks of 1998" have had their day? Overbought?
My guess is NO. Many institutions/money managers/mutual
funds missed the YHOO boat and other Web-related
profits. Plus, when you remember that a full $1.7
billion dollars of individual investor money got plunked
into mutual funds last month, that's got to go somewhere.
And I think the whole concept of e-commerce--and how
search engines play into that--is getting wide coverage.
6. YHOO! pulled a fade right before its earnings.
I think it was a retail fade, because the MM's held
firm (IMHO). Then YHOO, god bless Jerry Yang, popped
the big surprise... some of which were earnings from
investments, as I recall. And, boom, it's back over
$120. (Yes, SEEK isn't YHOO or XCIT for that matter,
but there is a connection being made in some folks'
minds.)
7. There's a SEEK/Deutsche Telekom Memorandum
of Understanding still hanging out there. Look for
details... or a contract... that might happen soon.
I'd certainly like to see it.
* Bottom line, 'Hopper, I'd hold... but I would
wouldn't I because I like the LONG picture...? 41
will be 70 within a year... but, that maybe too long
a timeframe for you. Don't apply my judgement. You're
way, way smart and quick and have a good eye for in-and-out
opportunities... I envy that.
Hope This Helps,
c m |
