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Technology Stocks : CheckFree Holdings Corp. (CKFR), the next Dell, Intel? -- Ignore unavailable to you. Want to Upgrade?

To: Benny Baga who wrote (8913)	8/10/1999 9:45:00 AM
From: CAPT TONY	Read Replies (3) \| Respond to of 20297

Benny and all, Reiterate BUY and Target of $80. CHECKFREE: 4Q/99 EARNINGS PREVIEW; BILLERS AND DISTRIBUTION MOMENTUM CONTINUES 07:46am EDT 10-Aug-99 J.P. Morgan (ARCHIBOLD, R. (1-212) 648-6231) CKFR August 10, 1999 J.P. MORGAN SECURITIES INC. - EQUITY RESEARCH RAIMUNDO C. ARCHIBOLD JR, CFA (1-212) 648-6231; archibold_raimundo@jpmorgan.com John Reilly Walsh, CFA (1-212) 648-8028; walsh_john@jpmorgan.com CheckFree (Buy) 4Q/99 EARNINGS PREVIEW; BILLERS AND DISTRIBUTION MOMENTUM CONTINUES; REITERATE BUY CKFR Earnings Per Share* P/E 52-Wk ------------------ ------------ MkCap 8/9 Rge 6/98 06/99 06/00 4Q/99 4Q/98 06/99 06/00E Yld ($MM) ---- ----- ----- ----- ----- ----- ----- ---- ---- ---- ----- $24.69 $69-6 $(0.05)A $0.04E $(0.35)E $0.05E $0.03A NM NM 0.0% $1,382 Calendar Earnings Per Share* P/E 52-Wk ------------------ ------------ MkCap 8/9 Rge 12/98 12/99 12/00 2Q/99 2Q/98 12/99E 12/00E Yld ($MM) ---- ----- ----- ----- ----- ----- ----- ---- ---- ---- ----- $24.69 $69-6 $(0.25)A $(0.09)E $0.00E $0.05E $0.03A NM NM 0.0% $1,382 * Excludes nonrecurring items. Our reports and models are now available on the JPMS MorganWISE Website. Please contact your JPMS salesperson for more information. CheckFree is expected to report its fiscal fourth quarter financial results after the market close on August 10th with a conference call at 8 am EDT on the 11th. Our EPS estimate for the quarter is $0.05, in- line with the consensus estimate. We expect revenue estimate for the quarter is $68.9 million and we expect subscribers to grow to 3.0 million from 2.8 million at the end of the prior quarter. We look for the company to provide more specifics regarding the timing of its launch of electronic bill payment via its portal partner, which we suspect is Yahoo! (YHOO/Buy/$121.19). We estimate the launch will take place within the next four to six weeks and will generate renewed enthusiasm for the promise of a electronic bill presentment and payment and CheckFree's clear leadership position in this market. We believe the announcement of the formation of "The Exchange" has caused undue weakness in CheckFree's shares and provided a favorable buying opportunity. We believe CheckFree's leadership position in distribution capabilities, biller relationships, bill presentment technology and pay anyone capability will enable it to extend and defend its current leadership position in the electronic bill presentment and payment market. Therefore, we re-iterate our Buy rating and $80 price target on CKFR shares. We expect the following will highlight the CheckFree results release and conference call: £ Competition - re-iterating the company's position that "The Exchange" will not effect CheckFree's ability to compete for billing relationships and the success at signing non-targeted billers will serve to increase overall adoption of electronic bill presentment and payment; £ Billers - we expect CheckFree will continue to expand its leadership position with billers due to the attractiveness of CKFR's bill presentment interactive capabilities and the company's unmatched distribution capability; £ Distribution - We look for CKFR to provide an update on the progress and timing of its partnership agreement with Yahoo!. We expect a bill payment capability will be launched within the next four to six weeks and bill presentment to be added in the calendar fourth quarter of 1999. We believe CheckFree has made continued progress in attracting other Internet portals/service providers to partner for electronic bill presentment and payment. £ Outlook - We believe investors would be wise to use the current share weakness to buy CKFR. We believe the company will exit 1999 with a launched integrated electronic bill payment and presentment capability with Yahoo!, a signed agreement with an additional Internet portal/service provider and a subscriber base well in excess of 3.5 million users.<b/> (The analyst or research associate holds a position in this stock.) First Call Corporation - all rights reserved. 617/345-2500 END OF NOTE Looks good to me, Capt T