I do not believe this is here:
Cybershop Up 38%; Co. Launching Electronics.net Site Thurs
By Joelle Tessler
NEW YORK (Dow Jones)--A stronger-than-expected third quarter earnings report from online
bookseller Amazon.com Inc. (AMZN), a bellwether for the electronic commerce business, has lifted
shares of many Internet retailers.
Amazon.com late Wednesday reported a pro forma operating loss of 49 cents a share on $153.7 million in
revenue, compared with a loss of 21 cents on $37.9 million in revenue a year earlier. Wall Street's
consensus estimate on Amazon for the latest quarter had been a loss of 57 cents a share.
The upside earnings report, combined with the four-fold jump in revenue year-over-year, has resulted in
"a little bit of a run" among the Internet retailer stocks Thursday, said C.E. Unterberg Towbin analyst
Adam Giansiracusa.
Giansiracusa added that better-than-expected fiscal first quarter earnings Tuesday night from America
Online Inc. (AOL), a bellwether for the entire Internet industry, have also encouraged investors.
AOL reported "fully taxed" earnings of 26 cents a diluted share on $858.1 million in revenue for its fiscal
first quarter, ended September, up from 8 cents a share on $521.6 million in revenue a year earlier.
The company beat Wall Street's consensus estimate of 23 cents a share for the latest quarter, largely due
to stronger-than-anticipated subscriber growth.
America Online, which has been aggressively marketing its latest software upgrade to AOL 4.0, said it
added 951,000 new members in the quarter, bringing its total membership to 13.5 million.
"Enough quarterly reports are behind us... and companies are beating numbers by a little more than
people thought they would," Giansiracusa said. "Internet companies are growing by leaps and bounds."
Shares of Cyberian Outpost Inc. (COOL), which sells computers and related products on the Internet,
were recently up 1 7/16, or 13.3%, at 12 1/4.
Shares of Cybershop International Inc. (CYSP), which sells everything from housewares to consumer
electronics to bath items on the Web, were up 2 1/4, or 38.7%, at 8 1/16.
And shares of online grocer Peapod Inc. (PPOD) were up 3/4, or 19.4%, at 4 5/8.
Amazon's third quarter numbers were not good news for all of the electronic retailers, however. The
company, which has been expanding beyond the book market and started selling music online this past
summer, said revenue from music sales came in at $14.4 million in the quarter.
This makes Amazon.com a bigger player in the online music market than CDNow Inc. (CDNW) and N2K
Inc. (NTKI), two companies that are focused solely on electronic music sales and are merging at least in
part to better position themselves to compete with Amazon.
CDNow posted sales of $13.9 million in the third quarter, while N2K posted sales of $10.5 million in the
period. "In one quarter of selling music online, Amazon is already beating both of them," Giansiracusa
said.
CDNow's shares were recently down 3/4, or 9.3%, at 7 5/16. And N2K's shares were down 19/32, or
10.8%, at 4 19/32.
Shares of Cybershop International have received an added boost from the launch Thursday of the
company's electronics.net Web site, said Jeff Tauber, chairman, president and chief executive. The site, a
joint venture with Tops Appliance City Inc. (TOPS), will sell consumer electronics and appliances on-line.
Tauber added that Cybershop International is planning to launch egift.com, a site that will sell gifts
on-line, early next week.
Peapod, meanwhile, is also up ahead of the company's third-quarter earnings report, due out after the
market closes Thursday. The consensus estimate for the company is a loss of 30 cents a share compared
with a 17-cent loss last year, according to First Call Corp.
Finally, shares of Cyberian Outpost, which closed at 8 1/4 last Friday, have been climbing all week
following the release of a report showing strong third-quarter PC sales by Dataquest Inc. Monday.
Dataquest said worldwide personal computer shipments exceeded 22.6 million in the third quarter, up
13.7% from the year-earlier period. And the research firm said U.S. shipments totaled 9.5 million units
in the quarter, up 18.2% year-over-year.
"The PC market continues to do very well," said NationsBanc Montgomery Securities Inc. analyst Steve
Horen.
Cyberian Outpost's chief financial officer, Katherine Vick, said the company's shares have also rallied on
strong earnings reports from several direct retailers of computer equipment that operate off-line.
On Monday, Micro Warehouse Inc. (MWHS) reported earnings of 33 cents a diluted share on $551.8
million in revenue for the third quarter, up from operating earnings of 16 cents a share on $522.1 million
in revenue a year earlier. The results were far above the First Call consensus estimate of 26 cents a share
for the latest quarter.
And Thursday, Insight Enterprises Inc. (NSIT) reported third-quarter earnings of 31 cents a diluted share
on $261.2 million in revenue compared with 22 cents on $171.3 million in revenue a year earlier. The
results for the latest quarter were 1 cent above the consensus estimate.
Horen noted that Cyberian Outpost's shares appear cheap compared with some of these other stocks.
Micro Warehouse is trading at about 20 a share, while Insight is trading at about 30. And CDW Computer
Centers Inc. (CDWC), which reported strong third-quarter earnings last week, is trading at about 75.
- Joelle Tessler; 201-938-5285 |
