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Non-Tech : Knight/Trimark Group, Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Pigboy who wrote (3711)	8/31/1999 9:26:00 AM
From: Gary Korn	Read Replies (1) \| Respond to of 10027

Pigboy, Welcome to the discussion, and please keep on posting! All insights are helpful. Gary Korn

To: Pigboy who wrote (3711)	8/31/1999 12:53:00 PM
From: Herschel Rubin	Read Replies (2) \| Respond to of 10027

Today's CBS MarketWatch mentions NITE favorably: cbs.marketwatch.com The Net effect on stocks - Good news to come for small-caps By Tom Nelson Last Update: 10:33 AM ET Aug 31, 1999 Courtesy of MicroCap1000.com BOSTON (CBS.MW) -- The good times are about to roll in the Internet small-cap sector, at least according to Jim Callinan, portfolio manager of the Robertson Stephens Emerging Growth fund. "I would suggest that over the next three years, the NASDAQ could be down, the Dow could be down and the S&P could be negative, while our types of funds might be up." Those skeptical of small-cap tech issues should consider themselves warned: Callinan recently topped Barron's-Value Line's list of the best mutual fund managers. For the 12 months ended June 30, Callinan's $1 billion fund had a total return of 59 percent versus 8.3 percent for the Russell 2000, its benchmark, and 23 percent for the S&P 500. Over the last five years, the San Francisco-based RS Emerging Growth fund outpaced the Russell 31 percent to 15 percent. After all that, Callinan is as bullish about small caps today as ever. What's your opinion of the small-cap segment these days? Callinan: It looks like small caps are still in freefall. Most of them are not participating in the market rally. We had a nice rally last week with the Internet stocks bouncing off the bottom, and now Internet stocks are going back up again. How long that lasts is anyone's guess. Because emerging small caps are the most volatile and most economically sensitive stocks, their stock price gets hit the hardest when the economic news is negative. You?re not painting a very pretty picture. Callinan: It's not a very pretty picture right now, but I'm saying the good news is still to come for small caps. People are starting to put a premium on segments of the small-cap universe that can show top-line growth. What was happening before was that a lot of people went after the cheap small-cap names or the cheap big-cap names and took them to valuations that were unsustainably high. That gave very high multiples even to large-cap companies like Coca-Cola (KO: news, msgs), which could never sustain a 45 P/E. Something was going to happen to a company like that. But a company like Echostar Communications (DISH: news, msgs) can sustain 25 percent-plus growth in its top-line for five to seven years. Coke could never do that. Haven't small caps been out of favor for several years? Callinan: There has been such significant underperformance by the Russell 2000 since 1993, but our fund has done well in that time. If small caps really start to make a move up, I think we're going to be in a good position. I would suggest that over the next three years, the NASDAQ could be down, the Dow could be down and the S&P could be negative, while our types of funds might be up. In which segments are you increasing your exposure? Callinan: We just had what was a 35-45 percent correction in Internet stocks, so we've increased our Internet exposure. It is a growth-spurt group that has tremendous fundamentals ahead of it. One of the reasons people are shy about small caps is that they don't know which stocks are going to win. They've been given 100 to 150 ideas to choose from and they're not sure which ones are going to be the winners. Are there any specific companies that you think are winners? Callinan: Hotjobs.com (HOTJ: news, msgs), which just came public, is a pretty significant new name that's not that well understood. I've always liked Knight/Trimark Group (NITE: news, msgs). It's a beneficiary of Internet stock trading. I like e-Bay (EBAY: news, msgs), because I think they disintermediate the classified section of the newspaper and they really take advantage of the interactivity of the model. I like Stamps.com (STMP: news, msgs) because it's a huge market and they can fulfill online. I like Network Solutions (NSOL: news, msgs) because I think there's going to be 300 million to 400 million ".coms," ".orgs," ".nets" by the time we're done with this thing. Basically, I like a lot of the networking companies that benefit from the Internet. ... _________ Pigboy, Thanks for pointing out the fact that PWJ has a position in NITE and therefore has an incentive to publish positives (I overlooked that).