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Technology Stocks : John, Mike & Tom's Wild World of Stocks -- Ignore unavailable to you. Want to Upgrade?

To: John Pitera who wrote (2301)	4/27/2001 3:13:07 PM
From: Logain Ablar	Read Replies (2) \| Respond to of 2850

We'll not all is doom and gloom. They do have a product which is selling but you can see pressure on ASP's from the telco's. With the increase in inventory this will hit eps. The cash burn was $146M which is way too high and DSO's jumped to 68. Cash is now $2.56 / share and current ratio is still healthy @ 9.4 (but with the cash burn this should be going down). My concern is the projected cash burn of another $278M this year.

To: John Pitera who wrote (2301)	4/27/2001 3:14:35 PM
From: John Pitera	Respond to of 2850

CD related news ----Homestore.com Comes In With Strong Numbers By Jay Somaney 4/26/01 4:51 PM ET Homestore.com (HOMS:Nasdaq - news - boards) came in with strong top- and bottom-line numbers after the close of trading Wednesday. The company reported pro forma revenues of $118 million and pro forma cash earnings per share of 4 cents vs. estimates of $110 and break-even, respectively. Not a bad performance at all. In addition, the company actually raised its guidance for the next quarter and the rest of the year. In response to the strong results, Homestore.com was up almost $5 Thursday, accompanied by all the customary reiterations and raising of top- and bottom-line estimates by sell-side analysts. The company reported strong growth in its core subscription business, which now accounts for approximately 64% of total revenues, with the balance coming from advertising. Furthermore, the company saw an increase across all Internet metrics, including page views per day, number of homes viewed on the site and average stay per visit. On the flip side, a majority of the company's subscription revenues are from Cendant (CD:NYSE - news - boards), which also happens to be Homestore.com's largest shareholder, with a 20% stake. Cendant clearly has a strong vested interest in seeing Homestore.com do well, as would any other investor. In addition, most of the subscription revenues are from real estate professionals who, in return for their subscription, receive their own profile on Homestore.com's Web site. Furthermore, a large portion of those subscriptions are not paid by the individual realtors, but are underwritten by their employers. So, for these subscribers, there's nothing to lose and much to gain if they get a sale as a result of user interaction. HOMS also saw its number of subscribers increase from 184,000 to 359,000 in the first quarter of this year, a very impressive increase of 175,000. However, a staggering 166,000, or 95% of those, were direct adds by Cendant. I also spoke at length with Delise Kiem, Director of Investor Relations at Homestore.com, who was kind enough to walk me through the company's numbers and plans for growth going forward. I totally agree with her that Homestore.com is the best site among those specializing in real estate listings and related services. In addition, its target market is just beginning to be penetrated, and the sheer dollar amount of real estate transactions is staggering. Will Homestore.com continue to grow? I have no doubt about that. However, at these levels, the stock could be ahead of itself and the cozy relationship with Cendant also raises some questions. We were fortunate to cover half our short position a few weeks ago, and we covered the reminder today, all in all leading to a profitable trade, albeit not as profitable as it would have been if we'd covered the entire position three weeks ago. So bring on half that crow.