ROBERTSON STEPHENS
The Internet Stock Team
-------------------------------------------------------------------
Unsubscribe:
internetstocks.com
If you do not have access to a browser, please reply to
mailto:internetstocks@rsco.com
with the message "unsubscribe" in the subject box.
Mailing List Changes:
internetstocks.com
-------------------------------------------------------------------
October 22, 1999
The Web Report - Volume 2, Issue #42
Internetstocks.com Overview - Keith E. Benjamin -
mailto:keith@rsco.com
This week, the NETDEX index increased 2% to 601.02 compared with the
NASDAQ, which experienced no change from last week.
While the NETDEX is up approximately 47% from its August lows, it is
still down about 25% from its all-time high of 801.41 on April 13. If
we look at percentage changes from low to high in previous quarters
(particularly last year's fourth quarter), the NETDEX was up 67.5% in
Q3:98, up 202.4% in Q4:98, up 66.0% in Q1:99, up 69.6% in Q2:99 and
up 47.1% in Q3:99.
We were encouraged by the slight uptick in the Internet group, given
the relatively weak overall market. Next week, we look for an
uptick in the eTail group. We view AOL's report of higher shopping
activity across a broader range of its members as an indication of
what to expect from eTail companies this quarter and next. We don't
expect the Internet group to make a major upward move until we get a
bit closer to the holidays. Outside of the eTailers, Stamps.com
standouts as indicated below. We were a bit concerned by the Media
Metrix data for September of 63.4 million unique users, which showed
only a slight sequential rise. We were revived by reports from
Microsoft, suggesting a strong pace of PC shipments, related
software, and potentially new Internet users. General trends in PC
and access pricing seem to support a December quarter increase in the
number of people with Web access. However, we believe the key driver
for the December quarter and the stocks will be higher spending by
the existing base of consumers. We believe consumers have become
much more receptive to the increasing advertising of many more things
to buy online. As such, we would hold our winners and be a bit more
selective on new positions.
Highlighted Stocks From The Internet Team
Among the stocks reporting next week, we believe much of the focus to
be on eTailing giants Amazon, eBay, and Priceline. On the eNetworks
front, we believe MapQuest, InfoSpace, Student Advantage, and
TicketMaster CitySearch are poised to deliver upside to our
estimates.
Stamps.com stands out to us, because we believe the company will
announce its initial product rollout by the end of October. Since its
preliminary launch in mid-August, Stamps.com has preregistered more
than 100,000 customers. We believe this was a much faster timetable
than was previously estimated. Therefore, looking out past the
launch, we believe Stamps.com wants to ensure that it has the
capacity to handle more than one million users. We believe a launch
during the week of October 25 is likely, and we are highly confident
that the company will launch by its Q3 reporting date of October 28.
Also this week, AOL expanded its relationship with Stamps.com making
the company the exclusive provider of Internet postage through a
three-year, $56 million agreement. We believe a successful launch and
future partnerships will help return the stock to and past previous
highs.
eTail Update - Lauren Cooks Levitan - mailto:lauren@rsco.com
The eTailDEX fell for a second week in a row, to 1251.86, down 1.5%
from 1270.38 last week, which was down 7.2% from the prior week.
The eTailDEX is currently up 54% from its recent low of 812.5 on
August 4 but still down 31% from the 52-week high of 1807.45,
suggesting room for substantial moves in the group over the coming
months. The market cap associated with eTailing players has become
increasingly concentrated in a handful of leading companies,
affectionately referred to by our team as the eTailing monsters.
Currently there are 43 eTailing stocks (a few recent IPOs will be
added to the eTailDEX shortly), representing a combined $84 billion
in market cap. However, those four monsters (Amazon, eBay, eToys and
Priceline) command 83% of that market value. The eight largest
stocks command fully 90% of the market value directed at eTailers.
While we recognize the tremendous benefits of scale and continue to
look for the monsters to drive gains in the group as we approach the
holiday season, we believe there are smaller cap eTailing stocks that
are addressing admittedly smaller markets, but often with interesting
business models. Small cap eTailers that we believe are poised to
succeed during Q4 (which should serve to narrow the valuation gap
that currently exists) include Alloy Online, Ashford.com, Garden.com,
Global Sports and Value America.
SORTING THROUGH THE GROWING LIST OF SMALL CAP NAMES - The valuation
gap we describe above is in part attributable to there being too many
eTailing stocks. In response to this correction of the supply/demand
imbalance that existed a year ago, we believe many niche-focused
players are being unfairly avoided. There are surely many eTailers
that are facing multiple competitors in inherently low margin spaces
that have anemic market values that we believe properly reflect this
unsustainable situation. However, we are particularly encouraged by
the recent and growing wave of specialty eTailers that are utilizing
the Internet to establish a value-added shopping environment that
could not exist in the physical world. Not surprisingly, the first
wave of eTailers addressed large product categories with distributors
and wholesalers involved, primarily in superstore environments that
focused on depth of assortment (books, music, computer hardware). A
growing base of eTailers are emerging as strong niche players
addressing higher gross margin opportunities, utilizing specialty
store features (like an edited rather than comprehensive assortment),
and benefiting from supply chain features that should establish
competitive barriers. We initiated coverage on two companies that
fit this criterion during the last week - Garden.com and Ashford.com
and look for other recent and future IPOs to fit this theme. We
continue to believe that relative valuations will increasingly be
driven by gross margin dollars rather than sales, positioning these
and other eTailers with greater potential to drive dramatic growth in
gross margin for positive stock price moves.
GARDEN.COM - A VALUE-ADDED SPECIALTY PLAYER BLOOMING - Last week we
initiated coverage of Garden.com with a Buy rating. We believe
Garden.com was ahead of the curve in identifying the attractive
online niche market for gardening products and is emerging as the
leading destination site for content, commerce, and community.
Gardening is one of the fastest growing and most popular leisure time
activities across a wide range of consumer segments, most notably
baby boomers, who are increasingly spending time and money on
gardening as they approach retirement. In addition, we believe
Garden.com's affluent customer base could prove attractive to
marketers and longer-term could result in significant sponsorship
revenues. The real key, in our view, to Garden.com's business model
is the company's elaborate grower network that is linked through a
proprietary extranet. We believe these supplier relationships
strengthened by particularly rich content create significant barriers
to entry. Over time, we expect the company's specialty store
environment coupled with sponsorship opportunities to support solid
gross margins pointing to a profitable business model. We expect
Garden.com will be a beneficiary of increased investor focus on
differentiated online retailers with higher gross margin levels to
support brand-building initiatives.
ASHFORD.COM - HIGH MARGIN OPPORTUNITY IN LUXURY GOODS, IN OUR VIEW -
We initiated coverage on Ashford.com this week with a Buy rating.
Ashford began as an eTailer of premium new and vintage watches, and
it has evolved into a one-stop shopping destination for a wide range
of luxury goods and premium products. In our view, Ashford.com has
established a first mover advantage in capturing the online segment
of the $70 billion accessories segment of the luxury goods market, a
market notable for its impressive gross margin potential, attractive
transaction economics (average order value of $300-500) and large and
expanding customer base. In addition, Ashford's growing base of
direct buying relationships (which now drive more than 70% of the
units it sells) provide credibility and advantages as the company
extends its reach into new product categories. This week the company
announced solid Q2 results, with sales increasing more than 20% to
$4.4 million versus the previous quarter and customer growth of 43%.
Preliminary reads on the site's new categories, including diamonds
and designer jewelry, were also very encouraging, with the company
reporting early traction to its new offerings, including the sale of
a $40,000 diamond in that category's first week. We look for an
aggressive offline marketing campaign and continued traffic driven by
Ashford's deals with AOL and Yahoo! to carry the company's momentum
through the holidays.
VALUE AMERICA - POTENTIAL BENEFICIARY OF IBM DECISION - IBM announced
this week that beginning in January it will no longer sell its
consumer line of desktop PCs (called Aptiva) at retail and will focus
primarily on the Internet channel. Given Value America's strong
relationship and current reseller agreement with Big Blue, we expect
the company to benefit from IBM's strategic shift. While we believe
IBM could select additional eTailing partners in the future, we
believe Value America has established strong online ties with IBM and
is one if its highest volume online resellers of consumer products.
While this news certainly wasn't welcomed by land-based retailers
that will lose the product line, we expect Value America should
benefit from IBM's decision as well as from its planned $30MM
advertising campaign (set to launch in Q1:2000) that will direct
consumers to the Internet channel.
EBAY GOES UPSCALE - This week eBay showed us why it acquired
traditional auction house Butterfield & Butterfield by launching
Great Collections, an area of its site for high-end, authenticated
antiques, collectibles, and fine items. In our opinion, the online
market opportunity for these products could be even larger than the
market historically addressed by eBay. eBay users have already shown
an interest in selling and buying the types of high-end items to
which Great Collections caters. Now, with Great Collections, we
believe eBay has successfully addressed the increased complexity of
high-end auctions to provide them with a highly attractive
incremental business opportunity. eBay's access to top authenticators
(through its ownership of Butterfield & Butterfield), coupled with
superior product supply through its auction house network, creates
significant barriers to entry. While we expect several new
competitive entrants, longer term we expect only a few players (among
them eBay) to succeed in this large, highly attractive market.
BEYOND PUTS LOSS LEADER STRATEGY TO THE TEST HEADING INTO Q4 -
Beyond.com reported Q3 revenues of $36.6MM and an EPS loss of $0.71,
better than our estimate of $33.5MM in sales and a loss of $0.74 per
share. While Beyond's 39% sequential revenue growth was impressive,
we believe investors are increasingly skeptical of sales generated at
the expense of deteriorating gross margin (which fell to 11.8% from
15.2% last quarter). Beyond's gross margin decline resulted from a
shift in sales mix to loss leader products and lower margin
government sales. In effect, the company was selling PDAs and MP3
players at discounts (analogous to inexpensive razors) with the
objective of selling higher margin software (or razor blades) in the
future. While we believe deploying loss leaders can be an effective
customer acquisition tool, we believe it is prudent to take a
wait-and-see stance to determine whether eTailers can convert new
customers acquired through loss-leader sales into repeat customers in
subsequent quarters. If Beyond can generate accelerated sales growth
during Q4 while expanding gross margin, we believe its stock could
break out from recent lows. We also believe the current depressed
valuation could attract potential acquirers that might be interested
in Beyond.com's growing customer base, digital download technology
and government and enterprise relationships.
PREVIEW TRAVEL - STRONG Q3 RESULTS EXPECTED TO BENEFIT PLANNED
COMBINATION WITH TRAVELOCITY - Preview Travel announced strong Q3
results with better than expected revenues of $9MM exceeding our
estimate of $7.8MM. While no specifics were unveiled, management
announced that Preview will launch a wholesale hotel room buying
service during Q4, a move we have been anticipating Preview could
successfully make given its nine million user base. We believe
leisure travel customers are price sensitive, and Preview could
convert more of its browsers into actual shoppers through lower price
vehicles. While we are careful to not get ahead of ourselves, our
positive outlook for Preview's shares revolves around its planned
merger with Travelocity. Consolidation could likely be the key
eTailing theme in 2000 as companies scramble to achieve critical
mass. In our view, the new Travelocity.com could realize commanding
market share in the online travel industry and be the best positioned
eTailer to capitalize on shifts in consumer buying behavior in favor
of the online channel.
CAN AUTOWEB LAP THE COMPETITION? - Autoweb reported Q3 revenues of
$8.4MM and an EPS loss of $0.18, which were well above our
expectations. Management indicated that it delayed the national
rollout of its advertising campaign for a Q4 launch. As a result, we
have moved the incremental advertising dollars from Q3 into Q4. In
addition, we adjusted our model to account for Autoweb's acquisition
of AIC, a leading automotive content provider, which closed this
week. Despite Autoweb's positive Q3 results however, given the
increasingly competitive environment for online auto sales, we
believe Autoweb is experimenting with multiple sales formats,
including auctions and direct purchases. We wonder which of the
emerging and changing online business models offer the greatest
potential for long-term shareholder value. We will continue to bring
attention to key happenings in the online automotive market and
update you on our thoughts towards this important category.
ONSALE REPORTS Q3 RESULTS - Onsale reported Q3 gross revenues of
$93.3MM, above our estimate of $88MM, resulting in a per share loss
of $0.82, in line with our estimate of a loss of $0.82. While we
await the Egghead merger to be completed to reevaluate Onsale's
outlook beyond fiscal 1999, we remain skeptical of the viability of
the atCost business model. During Q3, atCost accounted for 35% of
revenues, which resulted in a lower-than-expected gross margin level
of 3.8%. The atCost model contends that significant top-line traffic
and revenues can be generated to support the razor-thin margins it
produces, but we have yet to see compelling evidence that supports
this underlying premise. While we believe that the combined entity
resulting from Onsale's merger with Egghead may provide some gross
margin relief as well as create the name recognition and marketing
leverage to attract more customers and drive revenue growth, we
hesitate to endorse the company's outlook until we have visibility
into the operations of the merged company.
JOIN OUR ONLINE SHOPPING CHALLENGE - We recently launched a new area
on Internetstocks.com for our Online Shopping Challenge. In years
past we have asked our internal staff to use the Web for the majority
of their holiday shopping. Now we are extending that challenge to
you, our readers, and all other Web users. We have created an online
survey where visitors to internetstocks.com can comment on their
online shopping experiences. Our investment thesis has always focused
on strong brands offering the best in customer service and control
over the entire shopping experience. During the next few months, it
is our intention to collect enough surveys to make our study
statistically significant and report our findings to you on a
periodic basis. BizRate.com, a leading Internet data collection
service, is partnering with us and providing back-end support. In
return, we are offering one lucky winner a $10,000 online shopping
spree as well as making a charitable contribution on behalf of
participants. Please join us in helping to better understand our
eTailing space* and good luck, you might be the lucky winner!
Bookmark the following URL to make it easy to participate or go to
the Special Events area at our Web site, www.internetstocks.com.
internetstocks.com
MEDIA METRIX REPORTS SEPTEMBER TRENDS - While overall Web usage
increased only slightly, Web shopping declined slightly. Although
September's shopping usage declined versus August, we note that
September only has 30 days (versus 31 in August), which would account
for at least some of the drop. Taking the summer as a whole,
however, we were impressed by the season's results, particularly in
light of our original premise that online shopping would decline as
more people were drawn outdoors. In fact, unique visitors to
shopping sites were slightly higher in September than they were in
June, which we believe demonstrates encouraging momentum heading into
the holiday shopping season. We continue to believe that those
eTailers that posted strong usage metrics during the summer are among
the best prepared to capture significant share on online sales this
holiday season. Standouts during the time period included: Alloy
Online, which increased its unique users by 36.9% during the quarter;
Ashford.com, which showed particularly impressive momentum by
increasing its users by 37.4% over August, before heading into its
first major offline advertising campaign. eToys also rebounded
robustly in September from traditional summer weakness in the toy
category, posting an impressive 9.4% gain in unique visitors over
August. Standouts with respect to average user monthly time spent
during September were eBay, which regained the top spot at 107.4
minutes, and Value America, which improved from 10.8 minutes in
August to 25.1 minutes, its strongest showing to date. This was
enough to catapult Value America from fifty-seventh place to third,
reflecting the effectiveness of the company's ongoing marketing
efforts and broadening product offering.
eNetwork Update - Michael Graham - mailto:michael@rsco.com
EARNINGS FOCUS FOR WEEK OF OCTOBER 25th - Its appears to be a busy
week ahead with Student Advantage, Ticketmaster-Online CitySearch,
AskJeeves, StarMedia, LookSmart, Mapquest, InfoSpace.com, and
Stamps.com set to report earnings. We expect solid quarters from
each of these companies and believe the biggest upside surprises on a
percentage basis could come from InfoSpace, Student Advantage and
Ticketmaster-Online CitySearch.
CMGI SUMMIT MEETING ON TAP - CMGI will be hosting a summit meeting in
New York on October 25 and 26. Given the possibility for positive
news to be released, we believe this could act as a catalyst for the
stock. In the past, this annual event has proven to be an effective
way to focus a lot of investor attention on CMGI's potential.
AOL REPORTS STRONG QUARTER, EXPECT AD/COMMERCE UPSIDE IN Q2:00 -
Revenue of $1.5 billion was in line with our estimate. EPS of $0.15
was better than our $0.13 estimate. Domestic AOL member growth was
910,000, ahead of our 850,000 estimate. International subscriber
growth of 176,000 was well ahead of our 100,000 estimate. CompuServe
2000 member growth was 378,000, signaling the success of marketing
efforts for the lower-end brand. Ad/Commerce revenue of $350 million
was better than our estimate of $335 million, with backlog growing
33% sequentially to $2 billion.
On Wednesday, AOL also announced a deal with Gateway to jointly offer
Internet service to Gateway PC buyers, further extending AOL's reach
and possibly creating recurring revenue for Gateway. AOL members
spent $2.7 billion shopping online in the quarter. We believe AOL
has several ad/commerce contracts that are at or near performance
thresholds that could entitle the company to a share of eTailing
revenue generated by members in the December quarter. As a reference
point, ad/commerce revenue per subscriber for the quarter was up 13%
sequentially to $5.14 from $4.56, 2x the rate of total AOL brand
subscription additions helping to signal a potentially large move in
commerce revenue. We believe the stock can move back to previous
highs by the end of January 2000, with substantial upside to our
ad/commerce estimate in the December quarter. To move the stock to
the next level, we believe it will be important for the company to
show substantial progress on the broadband front, either DSL or
cable.
EXCITE@HOME'S Q3 RESULTS FUELED BY AT&T & EXCITE - Excite@Home
reported Q3 revenues of $112.5 million, well ahead of our $106.9
million estimate. EPS of ($0.01) matched our estimate. @Home added
220,000 subscribers in the quarter compared with our estimate of
180,000, benefiting from an aggressive rollout on the part of AT&T.
Excite showed exceptionally strong performance in the quarter.
Average daily page views grew 9.8% in the quarter to 89 million,
registered users grew 15.8% to 44 million. The company ended the
quarter with 4,200 @Work customers, significantly ahead or our
estimate of 3,100. We continue to believe Excite @Home will be
profitable by Q4 1999 and expect @Home to announce its one millionth
subscriber in early December. The strong subscriber growth gives us
more confidence than ever that Excite@Home could easily reach ten
million subscribers in two to four years, providing substantial
upside to the stock.
FATBRAIN LAUNCHES eMATTER, LANDS VULCAN FUNDING - Fatbrain
successfully launched eMatter, a new model for digital publishing.
The idea is to allow secure downloading of documents, enabling
publication of smaller-than-book length work on an economically
viable basis. In the six weeks since eMatter was first introduced
more than 3,000 authors and publishers have registered, including
McGraw-Hill, Red Herring, Salon.com, and The Industry Standard. Also
this week Vulcan Ventures, Microsoft cofounder Paul Allen's
investment arm, announced plans to invest $20 million in Fatbrain to
help fuel the company's eCommerce initiatives. We believe
Fatbrain.com is emerging as an eSourcing franchise with a valuation
that does not reflect its ability to leverage its loyal and growing
customer base.
SPORTSLINE REPORTS Q3 UPSIDE - SportsLine reported $15.2 million in
Q3 revenues, above our $14.8 million estimate, and a net loss of
$0.72 per share, well ahead of our estimate of $(0.82) per share. We
believe the upside was driven by strong traffic and ad sales related
to global sporting events, including the PGA Championship, the U.S.
Open Tennis tournament, and the Ryder Cup. SportsLine's traffic was
up to 9.3M page views per day from 8.4M in Q2. The SportsLine network
reached a record 4.7 million unique users in the month of September,
up 15% from August, according to Media Metrix. We believe ad sales
for the fourth quarter are tracking ahead of schedule as the NHL
season begins and college and pro football take center stage. We
believe SportsLine is beginning to have further visibility into
future quarters as it signs more multiyear deals with vertical
networks such as WebMD. We believe SportsLine can be successful in
adding more merchandise and growing traffic and expect it can grow
its presence as an online sporting goods retailer.
C|NET EXPANDS BRAND & DELIVERS RESULTS - Q3 revenues of $28.4M and
EPS of $(0.31) were ahead of our estimates of $26.4M and $(0.34).
Gross margins continued to demonstrate the leverage in CNET's model,
and we believe that they will continue to improve going forward.
Traffic was up 7.6% to 11.4 million page views per day versus 10.8
million in Q2, and CNET's shopping services generated more than
153,000 sales leads per day, up from 130,000 leads per day at the end
of Q2. We believe CNET is accelerating eCommerce revenues through
its new $100 million advertising campaign by reaching more consumers
and IT professionals and getting them to buy not only more, but
higher ticketed technology and electronics items.
QUOKKA SPORTS BEATS ESTIMATES & INCREASES KEY METRICS - Quokka Sports
reported Q3:99 revenues of $3.0 million and EPS of $(0.37), versus
our estimates of $2.7 million and EPS of $(0.48). Audience statistics
improved as Quokka's reach increased by 28% and the total time
connected per user per month increased 13%. We believe that Quokka's
content attracts a targeted audience, which can be leveraged by the
company to increase ad rates and online merchandising across its
site. We believe potential catalysts heading into Q4:99 could include
the signing of another major event rights deal and the addition of
one or two more business customers. We believe Quokka's rights,
technology and strategy should yield a large, long-term business
model as its content helps to drive the adoption of Internetwide
broadband services.
eMarketing Update - Lowell J. Singer - mailto:lowell@rsco.com
MYPOINTS.COM RAISES AD RATES - MyPoints.com announced an
across-the-board increase in advertising rates ranging from 15-40% on
the company's targeted e-mail offerings and ads on its Web-site. In
our view, this increase supports our thesis that advertisers are
placing greater value on targeted ad delivery vehicles. MyPoints.com
has the ability to accurately target its user base since the company
captures detailed personalized information when a new member joins
the program. MyPoints.com also recently announced that its total
membership base had surpassed the four million member level, which we
believe ranks the company as the largest loyalty program provider.
We are expecting positive news when the company reports earnings on
Monday. MyPoints.com's stock is currently trading at $12 down more
than 50% from its recent high of $26-*. We continue to believe that
the stock will move higher as investors reward the company for being
the leading loyalty program marketer.
NETPERCEPTIONS DELIVERS UPSIDE SURPRISE - NetPerceptions reported
that 3Q:99 revenues were up 46% sequentially to $4.1MM, above our
estimates of $3.2MM, and EPS of $(0.15) above our estimate of $(0.17)
per share. Net Perceptions added 25 new customers, including eToys,
Wine.com and SportsLine. We continue to believe that Net Perceptions
is building a powerful suite of personalization tools including its
products for eCommerce, Call Centers, Ad Targeting and Marketing
Campaigns. In addition, the company recently introduced Net
Perceptions for Knowledge Management, which we believe will be
increasingly important as corporations use real-time personalization
tools. In our view, Net Perceptions is well positioned to capitalize
on the increasing focus on a myriad of personalization tools.
eBusiness Update - Eric Upin - mailto:eric@rsco.com
B2Bs REPORT STRONG QUARTERLY RESULTS
CHEMDEX REPORTS SOLID Q3:99 RESULTS - Chemdex delivered a solid
quarter with upside to our estimates driven by greater-than-expected
revenues from VWR spot purchase products, expansion in the number of
enterprise customers and registered users, and transactions conducted
on the Chemdex marketplace. Chemdex reported total revenues of $8.5
million (representing 192% sequential growth) and operating EPS of
$(0.47). We were projecting total revenues of $6.0 million and
operating EPS of ($0.48). Reported EPS was $(0.49). However, we are
neutral on the stock over the near term. The stock has had a
significant run recently, and we believe the company's current set of
opportunities is reflected in the stock price.
ARIBA AND COMMERCEONE EXCEED STREET EXPECTATIONS - Ariba (ARBA) and
CommerceOne (CMRC) delivered impressive Q3:99 results and significant
upside to Street expectations. Both companies demonstrated strong
business momentum as online procurement solutions continue to gain
traction in the market.
For the quarter, Ariba reported revenues of $17.1 million, software
licenses of $9.8 million, and operating EPS ($0.12). The company beat
Street estimates by $3-4 million on the top line and by $0.05 in EPS.
Ariba added 11 new customers in the quarter, and experienced
greater-than-expected revenues from transaction-based license
revenues.
CommerceOne reported revenues of $10.4 million, software licenses of
$7.8 million and operating EPS of ($0.45). The company exceeded
Street estimates by $4-5 million, primarily due to strong software
licenses, and came in line with consensus EPS. The company added 15
new customers in the quarter, including Pepsi, Duke Energy, and
BellSouth.
VERTICALNET ANNOUNCES Q3:99 RESULTS AND PARTNERSHIP WITH
PAPEREXCHANGE - VerticalNet reported strong Q3:99 results on
Thursday, October 21 - exceeding our expectations as both advertising
and commerce revenues continued to ramp. For the quarter, the company
reported revenues of $5.2 million and operating EPS of ($0.29)
compared to our estimates of $4.6 million and ($0.32). FirstCall
consensus was ($0.31). The company plans to provide more details on a
conference call on Friday, October 22.
VerticalNet announced a four-year agreement with PaperExchange - one
of many relationships to come as Internet Capital Group continues to
leverage its partner companies to create the dominant player in each
of its markets. In terms of the agreement, VerticalNet's pulp and
paper industry site and PaperExchange.com will share content and give
users of both sites access to PaperExchange's marketplace - a $300
billion market opportuntiy. PaperExchange will gain advertising space
on VerticalNet's site, while VerticalNet will receive a percentage of
PaperExchange's commerce transactions. We view this partnership as a
positive for VerticalNet as it expands its market reach and
accelerates the company's commerce revenues.
PRIMUS EXPANDS ESERVICE OFFERING - Primus announced the beta release
of Primus Interchange, significantly expanding the functionality of
the company's eService solution. Primus Interchange offers customer
self-service on the Web, automated e-mail response, and online
interaction and collaboration with support personnel. By moving
customer support to the Web, Primus enables its customers to drive
down call center costs, while improving customer satisfaction and
retention - resulting in measurable ROI. Primus plans to launch the
product for commercial availability in early Q1:2000. We believe the
company continues to execute on its strategy of offering a
comprehensive eService solution built around its core problem
resolution knowledge base - a key competitive differentiation from
point solution providers. We are expecting another strong quarter
from Primus, which plans to release Q3:99 results on Tuesday, October
26.
eFinance - Weekly Stock Volume Report - Scott Appleby -
mailto:scott@rsco.com
VOLUMES UPDATE - Although weakened by turbulent and downtrodden
market conditions, volumes this week (October 13-19) continue to
point towards a strong |
