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Cautios comments From Briefing.com "CMG INFORMATION SERVICES (CMGI) 74 7/8 +5 3/4 What a week for this stock. It closed Friday at 56 7/8, and is now up an incredible 33%, pretty much in a straight line, over four days. While we covered CMGI on our Stock Brief pages on Monday and Wednesday, it certainly isn't our coverage that is causing this. The incredible volume on the stock shows that the momentum players have just descended on it in droves. Although CMGI did issue a press release today, which details a new investment by the company's venture subsidiary, CMG@Ventures III, in a company called Virtual Ink, it isn't really a factor. It's just plain continuation of the momentum surges that we see several times in CMGI this year. Momentum surges generally overshoot a top, and then retract quickly, so be careful if you have been considering a long term CMGI investment, but haven't acted yet. Unfortunately, for long term investors, Briefing can't really help with a determination of whether the stock is overvalued or undervalued. An investment in CMGI is an investment in approximately 30 different companies, about 2/3 of which are development stage Internet companies. The other companies report their revenues and earnings as combined line items. So deciphering the relative revenue streams of the various companies is practically impossible with the information that is publicly available. Long term investors are making blind-faith investments, although they have been handsomely rewarded for it so far, as the stock started the year at 15 1/4. But with this kind of movement on such high volume, with no real information, entering for the long term is extremely risky. Momentum investors are fickle and move in packs. When they leave, there is often a pile of bones left behind. Here's a table that shows how the volume has skyrocketed in the last couple of days. " |
