Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Net Perceptions, Inc. (NETP) -- Ignore unavailable to you. Want to Upgrade?

To: ynot who wrote (1181)	6/15/1999 1:13:00 PM
From: stockman_scott	Read Replies (1) \| Respond to of 2908

***FYI...Some Important Quotes from the new Wit Capital Report... <<We believe that Net Perceptions stands apart among Internet technology companies, in part because of a recent change to its pricing structure. As discussed above, Net Perceptions recently introduced a change to its pricing structure on the e-commerce side that enables the company to generate significant recurring revenue streams from its existing customers based on a per-user pricing model. While this structure was just implemented during the first quarter 1999, we believe that the longer term implications of this pricing model are very significant with regard to revenues, margins, cash flow and earnings. In our opinion, Net Perceptions is positioned within an elite class of high quality earnings companies in the Internet space. The basic question we have addressed in arriving at a valuation for Net Perceptions is: How quickly will the traditional "brick and mortar" retailing market shift to Web-based commerce and how many profiles will online retailers want to maintain? We see the possibility for geometric growth in Net Perceptions' market as more and more companies take their stores online and as more and more shoppers take their purchasing online. As a result, we should also see a dramatic increase in the number of profiles being maintained. If a person shops at 10 different online sites, each of those ten sites represents a need for a dynamic profile of that one individual. If 1,000 online sites are willing to pay for software to profile an average of 1.0 million shoppers each, that translates into annual revenues for Net Perceptions of approximately $67.5 million, the significant majority of which drops directly to the operating profit line and to cash flow. We also believe there exist growth opportunities from advertising software and the call center market, which by itself is expected to reach $58.6 billion by 2003 (according to IDC). As such, we believe that Net Perceptions should be able to reach and maintain higher operating and EBITDA margins than the average Internet enabling technology company. In our opinion, the company has the ability to be among the more profitable software companies (Internet or not), based on our expectations for future margins. During a time when Internet investors are becoming more focused on a "where's the profit" philosophy of investing, we believe that Net Perceptions has a very good chance of showing up on more institutional radar screens and eventually in more portfolios. >> Best Regards, Scott