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Technology Stocks : InfoSpace (INSP): Where GNET went! -- Ignore unavailable to you. Want to Upgrade?

To: starpopper who wrote (20332)	7/27/2000 12:31:08 PM
From: Hawkmoon	Read Replies (4) \| Respond to of 28311

There also was the sound of something HUGE on the horizon. You bring up an interesting scenario Starpopper. The combination of INSP/GNET could create a very powerful pre-packaged internet services group for a company like MSFT to acquire. The fly in the ointment though, is the DOJ action against "The Empire" that may put the kabosh on any acquisition by Mr. Softie until the issue is either resolved, or the company broken up. However, it certainly would provide them the opportunity to make up for lost time and would certainly sooth any problems with MSFT's internet strategy. Either way, I won't expect anything from them for at least 12 months. But on the flip side, the acquisition of GNET has certainly taken the wind out of INSP's market cap, sending the stock back down to triple bottom support at $35/share while providing support to GNET. Given that INSP is now on "rock bottom" support due to the arbitrageurs, then we can assume today's price on GNET is also pretty much rock bottom with more upside to come as INSP recovers. We'll gain 1.8 points for every point that INSP adds over the coming weeks. This brings up an issue as to whether this was the proper time to announce this acquisition. It would have been nice if INSP had waited until they had broken through the $60-65/share resistance level. That would have probably negated the major damage that we're seeing in their stock today and would have given GNET holders some more upside. And bursting through that resistance level would have once again asserted the implied support that previously existed at that price... <sigh> Looking at INSP's daily chart, you'll see what I mean: siliconinvestor.com Folks will be able to clearly see that upside momentum was just beginning to return to INSP... But then the acquisition effectively snuffed out that rally and cost INSP shareholders some serious equity, probably perturbing many call option holders as well. And given that GNET was seeing major call option action over the past weeks, INSP's weakness is now calling into question whether they will see any profitability from taking on those calls. Overall... VERY POOR TIMING on the part of INSP/GNET (sorry Russ.. but I call them as I see them). It would have been far better to let the earnings speak for themselves, the stock to rally, and THEN announce the acquisition. Announcing this yesterday nullified any positive action on INSP's stock price, has effectively placed a cap on GNET's uptrend at the pre-acquisition of $62/share, and left a whole bunch of big money dangling in the wind. It has effectively provided no increased gain to GNET shareholders, gains that were achieved independently by GNET management and employees. The wife and I will vote no on this merger unless INSP is able to generate some serious support for its stock. However, they have destroyed any support levels they were developing in their stock, and now they have major resistance above. Foolish... Very Foolish... Timing is everything, people... Regards, Ron