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Technology Stocks : OnSale Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Sowbug who wrote (887)	3/13/1998 1:47:00 AM
From: StaggerLee	Read Replies (3) \| Respond to of 4903

Ok, say 80% are on-line some day. That means ONSL revenues triple from here, all else being equal (which they won't be, with competition, etc). It's still not profitable enough to justify even half it's current valuation. I've been patiently reading this thread, waiting for someone to propose a realistic P&L whereby ONSL is profitable enough to justify a $500 million valuation. Nobody has. I'm beginning to accept that it's impossible. The business plan (i.e., selling used junk wholesale at 10% gross margins), frankly, can't get you there.

To: Sowbug who wrote (887)	3/13/1998 8:18:00 AM
From: MARIO PASQUA	Read Replies (1) \| Respond to of 4903

SB, everyone has his or her own way of how to invest. Some are speculative, and some are conservative. I am not saying that this company is not going to make it as a business. My question was, why would you buy a company with yearly growth in sales revenues, but no net profit for the past 3 years. I Do not have much time this morning to elaborate on the all concept. However, here is a quick question. Lets assume ONSL in 1999 will clear a net (12 months) profit of $ 0.60 per share. How much would you pay for the stock? How much of a net profit, do you think ONSALE will make in the year 2000? FLUCTUATION IN OPERATING RESULTS The Company's operating results have fluctuated in the past, and are expected to continue to fluctuate in the future, due to a number of factors, many of which are outside the Company's control. These factors include (i) the Company's ability to attract new customers at a steady rate, manage its inventory mix and the mix of products offered at auction, meet certain pricing targets, liquidate its inventory in a timely manner, maintain gross margins and maintain customer satisfaction, (ii) the availability and pricing of merchandise from vendors, (iii) product obsolescence and pricing erosion, (iv) significant reliance on various merchandise categories, (v) dependence on relationships with other Online companies, (vi) consumer confidence in encrypted transactions in the Internet environment, (vii) the timing, cost and availability of advertising on other entities' Web sites, (viii) the amount and timing of costs relating to expansion of the Company's operations, (ix) the announcement or introduction of new types of merchandise, service offerings or customer services by the Company or its competitors, (x) technical difficulties with respect to consumer use of the auction format on the Company's Web site, (xi) delays in revenue recognition at the end of a fiscal period as a result of shipping or logistical problems, (xii) delays in shipments as a result of strikes or other problems with the Company's delivery service providers or the loss of the Company's credit card processor, (xiii) the level of merchandise returns experienced by the Company and (xiv) general economic conditions and economic conditions specific to the Internet and electronic commerce. As a strategic response to changes in the competitive environment, the Company may from time to time make certain service, marketing or supply decisions or acquisitions that could have a material adverse effect on the Company's quarterly results of operations and financial condition. The Company also expects that, in the future, it like other retailers may experience seasonality in its business. Due to all of the foregoing factors, in some future quarter the Company's operating results may not meet or exceed the expectations of securities analysts and investors. In such event, the trading price of the Company's Common Stock would likely be materially adversely affected. In addition, the Company expects to experience substantial quarterly net losses through at least the first two quarters of 1999.