Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Creative Computers(MALL) -- Ignore unavailable to you. Want to Upgrade?

To: Secret_Agent_Man who wrote (781)	11/28/1998 4:25:00 PM
From: Secret_Agent_Man	Read Replies (1) \| Respond to of 1634

Steve Lin, sorry, I realize you are not "Tim"...here is the rest a comparison in a minute... Ubid's revenue growth looks impressive, up more than double from June to September quarters. Nine-month revenue to September hit $24 million. At that rate Ubid could reach $32 million annualized, putting the revenue multiple at 4x. If growth continues we estimate Ubid could generate $70 million revenue in 1999 putting the IPO market cap to revenue at 1.9x. That multiple looks more in line with Egghead than eBay (NASDAQ:EBAY) which approaches $7.8 billion (fully diluted shares outstanding), or about 91x our estimated 1999 revenue for it. Primary share market capitalization revenue multiple could be about 68x for EBAY. more If you compute the time it will take for uBid, COOL, TGLO, and ONSL to get to the point where their sales run rate is equal to their current market cap (i.e. P/S=1.0) by extrapolating their current growth rates then you get: ONSL 7 quarters COOL 5 quarters TGLO 5.5 quarters uBid/MALL 3 quarters. uBid/MALL is severely undervalued compared to the other internet companies assuming that MALL is indeed allowed to distribute the shares of uBid tax free. If not, then they are still undervalued but not by as much. Note that eBay and AMZN have substantially different models and so they can't be evaluated the same way, but by using an equivalent earnings potential model they reach par in about 8 quarters. Clark Note that I actually cut uBid's growth rate substantially to make this estimate (down to 75% per quarter over the next 3 quarters)- something which I did not do to any of the other companies/stocks. What this says is that to be valued at parity with the other similar internet stocks MALL should be about 100. If it were as richly valued as the richest internet stocks it would be closer to 250. I don't think the latter is reasonable currently given the uncertainty (too far in the future), but just FYI. To: hal jordan (740 ) From: USRX888 Friday, Nov 27 1998 10:53PM ET Reply # of 782 Make the comparisons between related companies.......... COOL Mkt cap 731 million CDWC Mkt cap 1.9 billion BYND Mkt cap 794 million EBAY Mkt cap 8.8 billion ONSL Mkt cap 1.9 billion MALL Mkt cap 578 million for MALL to even get to the lowest mkt cap of 731 million ..stock would have to be at 71.5....for a 1 billion mkt cap stock would be at 97.5......pick a number in between and that is where MALL we be ....say about 80 something.......to have a EBAY mkt cap stock would be at 857.......now thats some serious dough...........I will take over 75 .......by next week you see anyone can make comparisons and valuation models thought you'd like to know that UBID revenue estimates mentioned in the report by Steve Harmon are way off. UBID will do over $42 million this year (not $32 million), and will do in excess of $133 million next year (not $70 million). Huge upside here in UBID. Not many people know they are growing this fast. With net stocks soaring and academics pointing towards traditional valuation metrics to justify their doubt in the future performance of these companies, I present the single reason that Internet stocks have soared so high, and will continue to soar. In the spreadsheet below, you will see the 20 largest net stocks, including America Online. As of November 23, 1998, if an investor wants pure exposure to the greatest revolution since the industrial, they must own one of these stocks. Quite simply, there are not enough of these stocks to go around. As you can see, these 20 companies represent a total market cap of a little over $90 billion. That means the entire Internet sector combined would only be 23rd on the list of S&P 500 stocks ranked by market cap. When you factor out stock held by insiders, that number falls to under $60 billion. With well over $10 trillion in assets invested in US securities, if investors think that only 2% of their portfolio should be allocated to the Internet, these stocks would quickly triple in price. Supply and demand, its that simple! So when will the fundamentals catch up? Either there will have to be a fundamental shift in supply or demand. The first does not look to be happening any time soon, and the second is only likely in the event of global economic crisis. You want valuations? Forget about it, play supply and demand! Just look at the comparison I made to ONSL vs MALL MALL has sales of 600Million alone and earned a profit..ONSL is $97 for the Qtr ended 9/30/98 ONSL has revs of 57Mil in revs and a LOSS of 3+ Mil MALL had revs of 185 Million-15.3 Mil for UBID or 170.2 Million and turned a small profit 0.04/share it goes on and on I'll stop here...there really is only one way to value MALL or any other net stock and that is DEMAND vs Supply