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Strategies & Market Trends : Cents and Sensibility - Kimberly and Friends' Consortium -- Ignore unavailable to you. Want to Upgrade?

To: LANCE B who wrote (14199)	8/19/1999 8:09:00 PM
From: Kimberly Lee	Read Replies (3) \| Respond to of 108040

looks like his peers aren't his only detractors -- the press blasted Blodget as well: Blodget Talks, Press Balks Maybe the media's fixation with Net stocks is over. Maybe business writers stuck working in the final days of August are just cranky. Whatever the reason, media outlets listened to Merrill Lynch analyst Henry Blodget's latest round of rosy e-commerce predictions - and weren't having any of it. After jotting down his prediction that this year's revenue from holiday online purchases and advertising will be three times last year's take, they let loose with a round of stories that not only fired off plenty of skepticism in Blodget's direction, but also dismissed the latest Net mania for infrastructure stocks. The New York Times Robert Hershey offered the kindest cut, crediting Blodget's report for bumping Nasdaq up ... temporarily. By day's end, Hershey noted, it was down 13.49 points. Bloomberg wire copy posted on the Los Angeles Times Web site was quick to point out that Blodget's calls since his out-of-the-park homer on Amazon.com have largely been dogs. Of the 18 Net stocks he has recommended this year, only five have risen since being tabbed. Bloomberg dissed Blodget further by publishing his oh-so-happy analogies: "Although we are still marooned in August, Santa's sleigh ride is only five months away and this year we think he'll be doing a lot of his shopping online." To be sure, Blodget's comments nudged up stock prices on the companies he pegged as winners - Amazon, AOL, Yahoo, EToys, ExciteAtHome, Lycos, Inktomi and Barnesandnoble.com - but Bloomberg noted that Net shares he didn't recommend (like eBay) also surged. Seems like journos aren't the only ones cranky in the dog days of summer. "I don't think the Internet rally is attributable to any one person or thing," Dain Rauscher Wessels analyst Peggy Ledvina told the wire service. Bambi Francisco at CBS MarketWatch pointed out that Blodget has talked up the Web group before with little response. To many investors, the e-com stocks Blodget favors are passe. The Wall Street Journal reported that the new mania is for companies like Juniper Networks, Red Hat, Gadzoox Networks and Redback Networks, companies whose products make Net businesses tick - and whose stock has reached nosebleed levels in recent weeks. But the rise is probably all a mirage, Capital Growth Management portfolio manager Kenneth Heebner told the Journal's Susan Pulliam and Terzah Ewing. "Work the arithmetic. There is no way the earnings can get high enough to support this valuation." MSNBC's Christopher Byron agreed. The bullish scenario for the sector holds that demand for routers, switches and whatnot will engulf every established business in the field, Cisco included, Byron wrote. But that's bunk. For one thing, an intensifying price war is developing among the major long-distance carriers. The always-optimistic Byron went even further. "What if the Internet doesn't turn out to be a change-the-world, revolutionary event after all ... just a very important new development on the onward march of technology?" Well, then we'd all get a really long vacation. Holiday Forecast Lifts Net Stocks (Bloomberg) latimes.com