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To: TREND1 who wrote (9550)	5/19/1999 12:42:00 AM
From: Peter Arato	Respond to of 29970

Here you go Larry... Web Bets 9 Ways to Ride the Net The Upstarts You might think our next recommendation, eBay (EBAY), belongs in the riskiest category. After all, the online auctioneer's stock is up 140% in just the past three months, bringing the P/E to 300 times next year's earnings. But the eBay story remains compelling. For starters, as Salomon Smith Barney analyst Richard Zandi points out, eBay is currently the only profitable publicly traded Internet retailer--and it's getting more profitable practically by the hour. Blockbuster results in the first quarter forced Zandi to nearly triple earnings estimates for this year and to increase his 2000 projections by even more. Just as important, eBay's online bazaar, where customers can sell or buy just about anything (the offerings on one recent day included a three-carat blue diamond, 10,000 Italian buttons, and a 1,200-year-old ivory harpoon head), has clearly captured the public's imagination. By the end of last quarter, eBay had 3.8 million registered users, a 75% jump from the previous quarter. The number of auctions also soared, rising 68%, to 22.9 million. Not surprisingly, competitors are eyeing eBay's business. Rivals have yet to gain much traction, but Amazon wants into the auction market, and its efforts may grow more formidable with time. Still, eBay has a commanding lead that even Amazon may find hard to shake. (For a different take on eBay's ability to fend off Amazon, see Alsop.) Like every Internet user, you've no doubt spent what seemed like an eternity waiting for stuff to download. This is where @Home (ATHM) comes in: It delivers Internet access via cable modem at up to 20 times the speed of the fastest conventional modem. That's a terrific product, and @Home has shrewdly established close links with the right infrastructure players. AT&T, already among the nation's largest cable companies, has a 40% stake in @Home, giving Ma Bell a big incentive to help it outmaneuver competitors. AT&T's recent agreement to buy MediaOne and ally itself with Microsoft only improves @Home's position. If the world goes broadband, @Home should be at the center of the action. That affords the company huge opportunities. Lehman Brothers analyst Brian Oakes predicts that @Home's subscriber base should jump from its current 460,000 to more than two million by the end of 2000. Oakes sees revenues surging from $171 million in fiscal 1999 to over $700 million in 2000. The bottom line should also improve over the next year, as @Home moves from a $13 million loss to an estimated $44 million profit. Already established as one of the top four Internet brands--along with AOL, Amazon, and eBay--Yahoo (YHOO) needs no introduction. As the previous story points out, the Web's most popular portal is one of four stocks regarded by Wall Street as an Internet blue chip. (The others are AOL, Amazon, and eBay.) As that story also points out, Yahoo's valuation is "unearthly"--except in comparison with other Net stocks. But if you've already made peace with the fact that no Internet stock is cheap and you're willing to buy anyway, it's hard to ignore Yahoo. Like AOL and eBay, Yahoo is one of the few pure Net stocks that boasts real profits. The company's incredible gross margin--nearly 90%--is testimony to the underlying strength of the business model. Noglows predicts the company will earn more than $150 million in 2000. And if "capturing eyeballs" (i.e., viewers) has any value, as Net analysts believe it does, Yahoo is one valuable property. Its 47 million registered users make an enticing pool of customers for everything from streaming media to online bill paying.