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Technology Stocks : Amazon.com, Inc. (AMZN) -- Ignore unavailable to you. Want to Upgrade?

To: Frost Byte who wrote (44372)	3/7/1999 2:32:00 PM
From: larry oertel	Respond to of 164684

You place a lot of trust in Analyst opinions. Here is why you should not. Why would any sane analyst be Bullish on Nets? Here's why. The truth is you won't get rich being honest about I-nut prospects if you are an analyst. Who wants an Internet Bear in-house when you are trying to cash in on the IPO mania? Blodgets predecessor was pushed out, he did not jump. It's a Bull Market For Net Analysts By Dagen McDowell and George Mannes Staff Reporters 2/25/99 7:00 PM ET It's another Internet bull market mania. This time, it's for Internet stock analysts. Investment banks are making a stampede to grab high-profile Net analyst talent, the people who pick stocks and talk them up, in order to be able to offer underwriting services to private Internet companies thinking of going public. In their mad rush, these banks are now reportedly driving up salaries to such levels that analysts will soon need their own agents. In recent days, Merrill Lynch has recruited Amazon.com (AMZN:Nasdaq) bull Henry Blodget from his post at CIBC Oppenheimer. That follows the departure of Jonathan Cohen from Merrill, who left to head up the research effort at online investment bank Wit Capital. Now, NationsBanc Montgomery Securities, which lost Internet analyst David Readerman to startup Thomas Weisel Partners, is said to be looking for a new person to cover Internet stocks. And the firm, says a source, has extended a multiyear, multimillion dollar offer to Alan Braverman, Internet analyst at Deutsche Bank Securities. Braverman wouldn't confirm the story. He only says, "I've received a lot of calls from a lot of banks." NationsBanc Montgomery spokeswoman Jennifer Smith says the company has made it clear it's looking for a replacement for Readerman, but she declined to comment on whom the firm might have contacted. In addition to the analyst shuffle from one company to another, the demand has quickly raised compensation deals for Net analysts in the last six to 12 months, says one Wall Street recruiter. Although hot areas like telecom, the Internet and other technology sectors offer significantly higher pay packages, the rapidity of the ascent for Internet-related compensation is remarkable. "Like the stocks themselves, there is no gravity," the recruiter says. "In such a short period of time, the compensation has gone straight up." A top-ranked analyst could be making at least $5 million a year, the recruiter estimates. Behind the activity is the past year's boom in Internet stocks, and the multitude of public offerings in Net stocks set for this year. As previously reported in TheStreet.com, more than 30 Internet stocks companies are slated to go public already. To get underwriting opportunities, investment banks need an analyst on board -- the more famous, the better -- who can draw attention to a company's stock once it is trading. "The fact is no one wants to miss this cycle in Internet stocks, be it stock-price appreciation or underwriting," says a research director for a major brokerage firm. "For those reasons, brokerage firms don't have the patience to develop their own homegrown talent. They will pay up for anyone who has prior experience and visibility." The research director adds, "In all sectors, there is a dearth of quality sell-side analysts, and in the Internet sector it is most acute." If a firm has an investment banking deal in the pipeline and needs a ranked analyst on board, the firm will have to pay whatever it has to pay to get that analyst at the firm, says one veteran Wall Street professional. Then the firm will allocate the cost of the analyst between research and investment banking "and then they argue about who pays what," the professional asserts. If a firm does one deal, the analyst's compensation pays for itself in terms of banking fees, he says. Staff reporters Aaron Task and Gregg Wirth also contributed to this story thestreet.com