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Technology Stocks : 2TheMart.com TMRT -- Ignore unavailable to you. Want to Upgrade?

To: surelock who wrote (475)	5/25/1999 11:18:00 PM
From: StockDung	Respond to of 1494

LA Times, Part II: Internet Fever Gives 2TheMart.com Stock Wild Ride to 19% Loss By JONATHAN GAW, TIMES STAFF WRITER Los Angeles Times Friday January 22, 1999Orange County EditionBusiness, Page 1 Type of Material: Infobox; List Irvine-based 2TheMart.com Inc. saw more volatile swings in its stock Thursday, a day after the fledgling company announced plans to launch an auction Web site. After jumping 40% at the outset, 2TheMart.com's stock closed the day at $17.38, off 19%, or $4.13, from its closing price the day before on the thinly traded over-the-counter market. But the shares still were trading nearly nine times above their price a week ago--all for a company that has no products and no revenue and faces heavy competition. "This is very much a start-up company," said Richard Cutler, 2TheMart's attorney. "At this point it's trading on the Internet fervor just like everything else does." On Wednesday, the company said it had received $3.2 million in funding to build a person-to-person auction Web site to compete directly with EBay Inc., the Internet giant, which has a market value of more than $7.3 billion and claims more than 1.3 million users. Indeed, many Internet companies have seen their shares soar in frenzied trading. After its initial public offering was priced at $18 last September, EBay's stock rocketed to $321 a share Jan. 8 before taking a series of sharp hits in recent sessions. On Thursday, the 3-year-old company's stock slumped $32 a share to $181.75 in heavy trading on the Nasdaq National Market. Cutler shed more light Thursday on 2TheMart as well as its operations and plans. The attorney provided a four-page summary of the company's business plan outlining how 2TheMart would leverage its "unique business model." But the plan consisted almost entirely of paragraphs that appeared word for word in filings that EBay submitted to regulators last year. 2TheMart.com officials did not provide an explanation for the similarity. Cutler also gave an address for the company that turned out to be a post office box in Irvine. He said later that the company planned to purchase a building soon but that he had no other address for the company, which is supposed to be headquartered in Irvine. 2TheMart.com has 20 million outstanding shares, pegging the company's market value at $347.5 million, but Cutler said 19 million of those shares are held by its two officers, Dominic Magliarditi and Steven Reibel, who have been business associates in Nevada. Neither Magliarditi nor Reibel has a background in technology, but they have a long history in business, particularly real estate, Cutlersaid. "They have business savvy and business contacts that have allowed them to put the company in place," Cutler said. The officials have not sold any of their shares during the stock's recent run-up, Cutler said. He insisted that the company is preparing a Web site "that is technologically superior to EBay." The site should be up by the end of February or early March, he said, and will "improve the value of the product and the delivery systems." Still, financial analysts questioned whether the company has the wherewithal to succeed in the marketing wars being waged on the Internet. "If they are just following a path that appears to be successful, you have to look very carefully at who is backing them, what kind of assets and track record they have and how well they're run," said Phil Leigh, a financial analyst with Robert Stevens. Leigh, who follows electronic commerce, said he had not heard of the upstart 2TheMart.com. "The key determinant to success in cyberspace is going to be traffic, so unless these people can document that they have sizable traffic statistics that compare favorably to EBay, a prudent person would question why they would get the traffic that EBay has, or even a fraction of it," Leigh said.