May 18, 1998
Internet Chatter Accompanies Rise And Fall of Pro
Net Link -----
By JOHANNA BENNETT
Dow Jones Newswires
NEW YORK -- It's been a topsy-turvy month for Pro
Net Link Corp. (PNLK).
The on-line corporate networking company's stock
price has surged and plunged twice in the last
month. The only brokerage firm covering the OTC
bulletin board stock has advised investors to sell
their shares. Trading on Monday saw an
early-morning surge up to $6 a share, only to fall
back to a slight gain by late afternoon.
All the while, Internet message-board participants
continue a surprisingly supportive stance toward
the shares - despite some serious dips - by posting
more than 7,000 messages in less than a month on
Silicon Investor and Yahoo Finance.
"The excitement for the stock comes from all these
posts and the press releases the company is putting
out," said Sandy Greenberg, president of Chatfield
Dean & Co., the sole brokerage firm covering the
stock.
Shares of Pro Net Link recently were selling for
$4.93 a share, up 6%, following a price plunge late
last week and Friday's kickoff of the company's new
World Wide Web site.
"Any doubts about this company were quickly put to
rest over the weekend," wrote one Silicon Investor
participant. "If you did not take advantage of
Friday's sell-off, SHAME ON YOU."
Monday's action appears to be just the latest turn
in a three-week-long roller-coaster ride during
which the stock shot up from under $1 a share to a
high of 7 15/32 last week. But after Chatfield Dean
& Co. issued its sell recommendation, the stock
fell to its close Friday of $4.65 a share.
"There is absolutely no reason in our mind (for the
stock to be down)," said company spokesman Glen
Zagaoren. "Everything Pro Net Link set out to do
for our launch (of a new Web site) has been
completed on time... The only assumption I have is
that there are people out there whose intention to
drive stock down for their own gain."
Not everyone agreed.
A Chatfield Dean research report issued last week
contained the sell recommendation - a rarity in
financial circles - for the start-up company,
arguing that the company has no history of revenues
and the shares are overvalued. And accusations have
arisen from some circles that Pro Net Link was
being hyped on Internet chat rooms.
Last week, when the Pro Net Link hit an intraday
high of $8 a share, the company's market cap was
$300 million. By Monday afternoon, the valuation
hovered at $176 million.
The report also says the company lacks enough
capital to market its Web site, with $485,314 cash
on hand and a credit line of $500,000, not to
mention liabilities of more than $399,000 and net
losses of $364,000 for the nine-month period ended
May 7.
"I am not taking issue with the fact they want to
open an Internet business," said Greenberg, whose
company said it wasn't short on the stock. "What we
are taking issue with is the valuation being placed
on the company."
A Pro Net Link spokesman, as well as participants
in message boards on Yahoo Finance and Silicon
Investor, have taken issue with Greenberg's
statements, questioning the motivation behind the
rating.
Allegations of stock hype are "Hooey," said company
spokesman Glen Zagaoren.
"I am not saying there aren't people who hype a
stock... What I am saying is that my company and
Pro Net Link have been very active in making sure
the information on that site is very accurate,"
Zagaoren said.
A demo Web site has been averaging 10,000 user
sessions a month, good news considering the company
estimates signing up about 1,000 customers in the
first month, Zagaoren said. But by the end of the
first year, subscriptions will number 35,000 to
40,000 and account for $12 million in gross
revenues, he added.
Meanwhile, Company President Russell Van de
Casteele has put $100,000 into the company as of
May 11, Zagaoren said.
-Johanna Bennett; 201-938-5670
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