MSFT cash-flow margin is 15%, part II
case his rapid and peppy retort that PC ''demand
is good -- actually robust'' -- suggests Dell
once again will meet or beat analysts
expectations.
Finally, there's Onsale Inc. (Nasdaq, ONSL), the
online auction house. CEO S. Jerrold Kaplan
explains away the company's planned losses by
saying it is ''in an investment mode right now.
We're involved in a land grab. So we're out there
acquiring customers while the acquiring is
cheap.''
And Onsale's cost of customer acquisition --
new-customer-related marketing expenses divided
by customers added during the quarter -- is a low
$18. By comparison, H&Q analyst Genni C. Combes
estimates that online bookseller Amazon.com Inc.
(Nasdaq, AMZN) pays $20 for new customers and
Web-based brokerage E*Trade Group Inc. (Nasdaq,
EGRP) forks over $70.
Kaplan also boasts that Onsale customers are
beginning to buy in large volumes. In the last
four quarters, 3,700 customers spent more than
$5,000, 45 spent more than $50,000 and one
exceeded $1 million.
''Nobody buys $1 million worth of books online,''
quips Kaplan, engaging in his own thinly veiled
valuation argument that Onsale should be as
richly valued as Amazon, which it isn't. |
