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Technology Stocks : Exodus Communications, Inc. (EXDS) -- Ignore unavailable to you. Want to Upgrade?

To: Jane4IceCream who wrote (2988)	1/2/2001 7:54:25 PM
From: Dave Gore	Read Replies (1) \| Respond to of 3664

Morningstar's Reassuring "take" on EXDS ...I found this just now and thought others may not have seen it. One interesting comment is this: "All major Web hosters are losing money in order to expand their infrastructure." In other words, they could have profits if they wanted to but choose to expand instead. HERE's THE FULL REPORT: Stock price as of analysis date: $26.25 Exodus is the sole Web hoster that we would consider scooping up now. If anyone makes a killing in the Web-hosting market, it will be Exodus. Despite being weighed down by heavy capital expenditures inherent to the industry, Exodus is the clear leader in a booming market. Technology market research firm Gartner Group IT forecasts Web hosting will grow from a $4.2 billion business in 1999 to $20 billion in 2003. We find Exodus' recent acquisition of Global Crossing's GX GlobalCenter Web hosting unit to be a shrewd move; with one fell swoop, the firm cemented its leadership in the market. According to a 1999 study by International Data Corporation, Exodus has the greatest market share (9.3%) in this fragmented industry, leading rivals Verio VRIO (7.6%) and GlobalCenter (5.6%). Through organic growth and the pending close of its latest acquisition, Exodus' market share is poised to exceed 20%. Among its 2,830 customers are 48 of the top 100 Web sites, as measured by Jupiter Media Metrix JMXI. Exodus is pulling away from the competition through its mastery of up-selling--winning customers with basic packages, then adding premium services. Once customers sign up for basic Web hosting, they are offered a wide array of services, including security software, network traffic monitoring, consulting, data backup, and caching. Successful up-selling boosted average revenue per data center customer to $299,000 in the September quarter, compared with $259,000 in the June quarter. The biggest risks to the company are industry-specific: Like most other Web hosters, debt is high and profits are slow in coming because of the buildout of data center facilities and network infrastructure. We think this group of stocks tends to be quite risky. However, Exodus is the one gem of the bunch by being closest to profits, claiming dominant market share, and holding a strong cash position. A post-earnings sell-off at the end of October sent Exodus stock tumbling into the $20s. We believe that this price drop has been overdone, and that patient Exodus investors will be rewarded.

To: Jane4IceCream who wrote (2988)	1/3/2001 10:33:35 AM
From: Dave Gore	Read Replies (1) \| Respond to of 3664

* Due Diligence for New Investors of EXDS * Hopefully this will provide a jump start so those interested can start your own DD. A FEW HIGHLIGHTS: 23 Strong Buys, 6 Buys, 1 Hold with a Zack's rating of 1.29 ....which is a slight improvement from the 1.30 Strong Buy rating of 30 days ago ( I won't insult anyone's intelligence with silly-sounding Price Targets but I do feel it is a good buy here) Morningstar gives it an A+ growth rating and calls it the best stock in its sector; says it could more than double its Market share in a very healthy sector expected to grow some 400% by 2003 to $20 Billion according to both Forrester Research and Gartner Group. It currently dominates the sector quite handily. "The company is growing by leaps and bounds. Sales increased 238% year over year to $229.6 million for the third quarter of 2000". (quote from Morningstar.com) EXDS has actualy been able to RAISE Prices 10% across the board due to heavy demand, says the Morningstar report, even in this slowing economy. They are not profitable because stocks in this sector plug potential profits and a great deal of revenues back into infrastructure growth (as do all the companies in this sector), so that is less of a concern to analysts than it normally might be. Among its 2,830 customers are 48 of the top 100 Web sites, as measured by Jupiter Media Metrix JMXI. They are primarily targeting Fortune 500 Companies, according to Morningstar.com ** Exodus was recently declared a "National Infrastructure Asset" by the U.S. Government and issued by the White House (Source: Oct PR). This is a trickily traded stock that ran up 9 points a couple weeks ago in just 30 minutes from $26 to $35 and lately has fallen down from $35 to $16 on no negative news from the Company or downgrades from analysts. PS- Most of this info was from Morningstar.com, Zack's, Briefing.com or Company PR's. Again, do your own DD.