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Technology Stocks : K-Tel (KTEL) Have the cheesy '70s records come to an end? -- Ignore unavailable to you. Want to Upgrade?

To: LTK007 who wrote (479)	4/21/1998 7:55:00 AM
From: Breeze1	Read Replies (1) \| Respond to of 3203

More info from Yahoo. Internet stocks are now becoming a sector with their own momentum that rubs off on any stock that comes in contact with them, analysts said. K-Tel International (KTEL - news), the music company, was cited as one example. The company's stock has soared since it said last week it would sell products on the Internet. Monday afternoon, K-Tel topped the most active list on the Nasdaq. It closed at 41-5/8, up 12/15. ''K-Tel defies all parameters and we are keeping away from it,'' said Conley Turner, an analyst who tracks Internet stocks at Wall Street Strategies. The Internet sector has become a ''new paradigm. In terms of fundamental valuations, they are way beyond (normal levels),'' Turner added. Analysts try to compare stocks in the sector by looking at revenues rather than earnings because many are still lossmaking start-ups. But even this measure is not foolproof. ''These things are trading on expectations rather than on any multiple of revenues or otherwise,'' Newman said. ''The risk is when there comes a change in expectations.'' ''What you are trying to do is ... to assess a company's prospects in a brand new, rapidly developing industry, and you are laying your bet on an analysis of what kind of prospects you think they have,'' Newman said. Some investors look at the ''hit ratios'' or ''click-through ratios'' or ''audience ratios'' to calculate how many people use the service. ''This is causing the investment community to totally change their thinking,'' Morabito said.