Mon Jun 22
eMailbag Monday:
Comments On Check Point Software, Onsale, & More
By Steve Harmon
Senior Investment Analyst
Internet.com
"Where Wall Street Meets The Web"
"Hello Steve, thank you very much for your very informative Internet Stock Report. I enjoy reading it and try not to miss an issue. Could you tell me what your opinion is about Checkpoint Technology stock (CHKPF) and it's future. Checkpoint Technology has been a firewall market leader for the longest time with stock price as high as 50 1/2. However, recently it's stock has been in the slump for no apparent reason."
Reply: We believe that the security software market is long overdue for consolidation, that mold grows on parts of the franchise. The leading firms such as Check Point Software (NASDAQ:CHKPF - news) and Security Dynamics (NASDAQ:SDTI - news) so far haven't led the charge here and Wall Street may simply be getting impatient for any of them to scale. Meanwhile competition, of the threat of it, looms larger from IBM, Microsoft, Network Associates, and others. Check Point Software rules in firewalls but can it extend that power to the wider security opportunity? Somebody will. The rule on the Internet is "get big fast." And just when you think you've done so, get bigger.
On Or Off Sale?
"Do yall think ONSALE (NASDAQ:ONSL - news) is comparable to Amazon.com? Are there any other competitors worthy of mention, or is Onsale.com sitting on top of a monopoly? What the hell is wrong with this stock? It gets added onto the Russell 3000 and tanks the next day? Is all this bad luck happening to just me, cause it sure does feel like my luck."
Reply: Onsale runs Web-based auctions where bidders determine ultimate sale price, while Amazon sells books, music and video the fixed-price way. Part of the stock's drop may be due to the increased marketing of rivals and some of the novelty wearing off. Onsale competitors of note include Surplus Auction, a division of Egghead.com (NASDAQ:EGGS - news) and the privately-held eBay. We've always believed Onsale was a great idea and leader, pioneering the combination of computing power (bidding and processing bids) with the Internet (distribution and people). Room for expansion exists in auctioning, as does the ability for Onsale to just sell things, on sale. |
