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Strategies & Market Trends : Market Gems:Stocks w/Strong Earnings and High Tech. Rank -- Ignore unavailable to you. Want to Upgrade?

To: ynot who wrote (56429)	8/18/1999 4:51:00 PM
From: puborectalis	Respond to of 120523

Go Lycos("downright bargain")............Shares of the Internet portal/search engine jumped amid cheers for the company's fourth-quarter earnings that came in after the close Tuesday. Lycos earned a penny a share to beat the consensus forecast for break-even numbers. Revenue rose 28.6% from last quarter to $45.1 million, which also exceeded projections. The company backed analysts' forecasts for the current quarter and reiterated it may sell part of its international operations to the public. "Considering a typically weak seasonal quarter, the results were great," writes Merrill Lynch analyst Henry Blodget, a Wall Street Journal All-Star. "The company exceeded consensus in most key metrics -- namely revenue, EPS and pageviews." He points out that its sequential-revenue growth was faster than its major portal competitors', and says the outlook for the next several quarters remains good. Even though the company continues to reinvest revenue into sales and marketing, it will still be profitable next year. He calls the company's balance sheet, with $153 million in cash and no debt, "excellent." As for the stock, it is "a downright bargain," Blodget says. The stock trades at 98 times his earnings forecast of 43 cents a share for calendar year 2000. What's more, Blodget considers Lycos a prime takeover candidate. The earnings news also prompted James Preissler at PaineWebber to upgrade the stock to Buy from Neutral. Though he is still concerned that Lycos continues to seek a firm brand identity and build customer loyalty, he believes that the company "continues to execute well, and offers value at current levels." He raised his 12-month share-price target to 75 from 63. CS First Boston's Lise Buyer, in a note titled "Back in Black!", writes that Lycos' e-commerce plans "could be the long-awaited key to monetizing their impressive traffic." The company plans to launch its e-commerce platform -- which provides tools that merchants need to get online -- at the end of September. The platform also provides Lycos with ad and other revenue opportunities, Preissler says. KM --------------------------------------------------------------------------------