Sue, your link took me to an AKLM article> Here is the WSJ article>
As Go2Net Shares Gyrate,
Firm Readies for Prime Time
By LISA BRANSTEN
THE WALL STREET JOURNAL INTERACTIVE EDITION
SAN FRANCISCO -- Shares of Go2Net slipped Tuesday as
Monday's spectacular rises on the Internet front gave way to
a round of declines.
In Nasdaq Stock Market trading,
shares of the Seattle network of Web
sites slipped 20 15/16, or 17%, to
close at 99. Such a point drop would
have been a disaster just a week ago
when the shares were trading at 36
1/4, but it wasn't bad given the 53
15/16 point, or 65%, gain the shares
posted Monday.
Meanwhile, the Nasdaq Composite Index fell 63.84 to
2320.75 and Morgan Stanley's high-tech 35 index dropped
32.39 to 945.30.
The big -- but probably at the moment unanswerable --
question for Go2Net is whether it is a credible but
undiscovered Internet guide site along the lines of Yahoo!
and Excite, or just the latest stock to be touched by Internet
mania. Go2Net is a network of Web sites, including Silicon
Investor (www.techstocks.com), the popular investing
community site, and MetaCrawler (www.metacrawler.com),
a search engine that queries and gives results from all of the
major search engines. On Jan. 4, the company announced
plans to acquire Web21, a Palo Alto, Calif., firm that
provides rankings of the most-popular Web sites.
Monday's surge in Go2Net shares came after Jeff Goverman,
an analyst at Pacific Crest Securities, Portland, Ore.,
initiated coverage of the stock with a "strong buy" rating and
set a 52-week price target of $125.
Mr. Goverman said he believes that the company has enough
traffic to make revenue grow quickly.
Go2Net "has spent the last two years building its
infrastructure and community," he said, adding that the
company "is currently opening up sales offices nationwide to
leverage its traffic." Only two analysts, Mr. Goverman and
Dalton Chandler of Needham & Co., formally cover
Go2Net, and both believe there is value in the shares.
Mr. Chandler said he believes the company is a credible fifth
Internet guide after Yahoo!, Excite, Lycos and Infoseek.
And he added that -- even given the price at the close on
Monday -- the company has a far lower valuation than any of
its counterparts. Based on data from the Web
traffic-measurement company Media Metrix, Go2Net was
valued Monday at $166 per unique user, compared with
valuations of $285 per user for Yahoo, $241 per user for
Lycos, and $220 per user for Infoseek.
Also, he said, Go2Net could make an attractive takeover
target for a media company that's seeking to acquire a Web
audience, but unwilling to pay billions for Yahoo.
But Go2Net is dwarfed by its bigger rivals in the revenue
arena. It had $1.9 million in sales in its third quarter; for the
comparable period, Yahoo had $53.6 million in revenue,
Excite had $44 million, Lycos had $24.8 million and
Infoseek had $19.2 million.
Also, Go2Net has little in the way of the enormous brand
recognition of a Yahoo. That's something the company is
trying to fix, said Mark Peterson, a Go2Net spokesman:
Instead of building the brand and then building the properties
on top of that, the company focused on building up an array
of Web properties and is now focusing on building the brand.
Share-price movements like
Monday's for Go2Net have
been enough to stop Lise
Buyer, an analyst at Credit
Suisse First Boston, from
assigning any more price
targets to the Internet stocks
she covers. Price targets
"imply that the stocks are trading on underlying
fundamentals," she said. Right now, Internet stocks "are
trading on momentum -- there's nothing more than that." |
