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.

Microcap & Penny Stocks : Bid.com International (BIDS) -- Ignore unavailable to you. Want to Upgrade?

To: Ruyi who wrote (22579)	4/19/1999 9:13:00 PM
From: Bountybull	Read Replies (2) \| Respond to of 37507

Top Financial News Mon, 19 Apr 1999, 8:59pm EDT America Online, Yahoo Lead Plunge in Internet Shares on Valuation Concerns Internet Shares Tumble on Concern About Valuations (Update4) (Updates with details about online brokers in 10th through 12th paragraphs.) New York, April 19 (Bloomberg) -- America Online Inc., Yahoo! Inc., and other Internet related companies tumbled amid concern that many of these high-flying stocks are overvalued. Inter@ctive Week's Internet index, a benchmark for Internet stocks, fell 40.84 to 277.74, or 13 percent, its biggest decline since August 31. America Online, the No. 1 online service fell 23 3/4 to 116, slicing about $22 billion from its market value. Top Internet search service Yahoo dropped 25 1/2 to 163 11/16, or by about $6 billion. ''What you're seeing is a violent transition out of some of the Internet'' stocks, said Philip Schettewi, who helps oversee $4 billion for Loomis Sayles & Co. in Washington. The Nasdaq Composite Index has declined 9.7 percent in the past five days as investors sold shares of technology-related companies and snapped up shares of so-called cyclical companies, which haven't done as well in the past year. Today's 5.6 percent drop in the Nasdaq was its third-biggest drop this decade. ''Nasdaq is just being annihilated. The valuations are just tipping over,'' said Marian Kessler, a fund manager with Portland, Oregon-based Crabbe Huson Group, which manages some $3 billion. ''We needed some return to some valuation saneness.'' Morgan Stanley Dean Witter & Co. analyst Mary Meeker warned in the New Yorker magazine of a ''big correction'' for the group. Meeker likened the mania for Internet stocks to the tulip-bulb craze in Holland in the late 17th century, which sent prices of bulbs soaring before the market eventually crashed. Meeker's interviews have moved stocks before. In February, Amazon.com Inc., Yahoo and Ebay Inc. soared after she called their long-term outlook ''phenomenal.'' Online Brokers Amazon.com, which surged more than 10-fold in the past year, and other Internet companies had been some of the best performers this year amid investor optimism for the evolving medium. Today, top online retailer Amazon.com fell 31 1/16 to 158 15/16, Infoseek Corp., the No. 4 Internet search service, fell 14 7/8 to 45 5/8, while DoubleClick Inc. slipped 34 1/16 to 104. High-speed Internet provider At Home Corp. dropped 26 to 118 15/16, while top Internet auction company eBay Inc. fell 21 7/8 to 154 1/8. Inktomi Corp. plunged 29 1/2 to 89. Online brokerages also suffered. Ameritrade Holding Corp. and fellow online broker ETrade Group Inc. had their worst-ever one-day declines, while Charles Schwab Corp. suffered its biggest drop in 3 1/2 years. Combined, Schwab, Ameritrade and ETrade shed $31 billion in market value in four days, about what Merrill Lynch & Co. is worth. ''The general pullback in Internet stocks is investors cashing out after big gains,'' said Bill Burnham, an analyst with Credit Suisse First Boston. ''When Net stocks go down, online brokers go down more because they have double exposure to the Internet -- they're Internet stocks that make a living trading Internet stocks.'' Ameritrade fell 38 1/8, or 30 percent, to 87 7/8. E*Trade fell 18 3/4, or 20 percent, to 73 13/16, while Schwab dropped 12 13/16 to 102. Still some analysts were undeterred by the slump in Internet related stocks. ''It's probably some rotation out of some of the more profitable names into something more stable,'' said Jefferies & Co. analyst John Tamburro, who rates EarthLink Network Inc. a ''buy.'' ''Any continued weakness should be an opportunity to reenter these names at cheaper levels.'' Internet shares tumbled on early January as concern gripped financial markets that economic turmoil in Brazil would slow world economic growth. Broadcast.com Inc.'s shares dropped 22 percent on Jan. 12, while Amazon.com tumbled 12 percent. They later rebounded to be among this year's biggest gainers.