Internet Update
Dateline: 08/09/99
Click on the title above for this week's Movers & Shakers table.
We now have 87 stocks on our charts of which 35 moved by more than 10% last week. Of those, only 8 advanced. A whopping 27 had double digit declines.
17 of the 35 made double digit moves the previous week as well. Three recovered from losses to post gains and two stocks are in a second week of large gains.
Call-Net Enterprises, is in its second week of advances after having been battered previously. It gained 16.0% this past week and has climbed 28.5% in the last two weeks. Call-Net is the company that owns Sprint Canada and its Internet division, The Most™.
And new addition to our list, iWave Inc., is also in its second week of double digit advances. It has gained 75.0% in two weeks climbing from $0.40 a share to $0.70 Friday. It is the focus of one of this week's profiles.
Of the other twelve, nine are in their second week of double digit declines. Again there has not been any stock showing a third consecutive week of such drops. Starnet continues to be battered by bad press and has recently been threatening lawsuits against media publishing false and damaging information about the company - this after a false report that a Las Vegas casino was suing Starnet for a billion dollars. The stock is off 34.7% for the two weeks.
Another high flyer that has been taking a beating is Research in Motion which has lost 27.8% of its value in the last two weeks. Multiactive Software is down 28.0% for the period, Planet 411 nosedived 28.6%, Essex Resources is off 30.2% and Innofone lost 33.0%. The largest two week drop was Clickhouse.com, one of the new stocks we added this week, which plunged 50% in two weeks.
Of the rest of the list, the most notable is 8 Crown Capital, whch jumped from $0.40 a share to as high as $3.52 a share on news of 8 Crown's takeover of Starfire Technologies, an Internet advertising company. Starfire is a going concern with its Starpages™ flagship product. It had revenues of $285,196 in 1998 which jumped to $1,203,004 for the first six months of this year. As at June 30th, 1999, Starfire had assets of $915,339 including $823,263 in cash.
Starpages is a searchable enhanced version of the traditional Yellow Pages.
Have you noticed a pattern here? Whenever some small relatively unknown company takes over or buys a stake in an Internet based business, its share price jumps in the early stages, then settles down to a trading range. The initial jump is often huge, particularly in the current case where the company being bought is profitable and has a huge cash reserve.
The people making big profits on the takeover are those in the know who manage to get shares before the takeover as well as the shareholders of the company taken over.
8 Crown was launched in January as a venture capital company and commenced trading in June after a million shares were initially distributed at $0.20 each raising $200,000. Another 2 million shares were put in escrow. The company is authorized to issue 100 million. The terms of the deal with Starfire issues another 28,145,000 in stages over three years.
The deemed price for the 25 million to go to Starfire shareholders is $0.24 for a purchase price of $6 million. But the huge run-up in price actually makes the shares worth $77.5 million. Although Starfire seems to be growing revenues at a great rate, it will be interesting to see if such a lofty stock price can be sustained while the shares are in escrow. Investors clearly see a rosy future for the company (at least so far!)
Canadian Internet Stock
Index
Metamorphosis Index
Yankee Index
We added one new stock, e-Station.com , to our CISA chart, and one stock, Bingo.com, to our Yankee Index. We added another three stocks to our Metamorphosis Index - Clickhouse.com, iWave.com and 8 Crown Capital. We profile iWave below.
Comments? Suggestions? Why not post them on our Bulletin Board or email me.
E-mail me!
08/05/99 - A
Question of Balance
Artist and philosopher, Daryl Maddeaux is using his talents to
teach children and business people to think creatively.
08/02/99 - Internet
Update: AdvanteXCEL.com and e-Dispatch Profiled
We profile two new stocks added to our indexes as well as our
usual Monday look at the Internet Movers & Shakers.
07/26/99 - Internet
Update: Actfit.com and Multiactive Software Profiled
We profile two new stocks added to our indexes as well as our
usual Monday look at the Internet Movers & Shakers.
07/22/99 - Making
Us More User Friendly
We've added a new resource page and tell you all about it.
07/19/99 - Internet
Update: Innofone & NetNation Profiled
Along with our Movers & Shakers list and updates to our
Internet indices, we profile two new additions to our Yankee
Index.
Disclosure: The author may own shares in some of the securities listed.
Updates: I've added two new categories of Net Links to my pages. They are Biotech and Info for Non-residents. Both are still in their formative stages and I will be adding more links as we go along. If you know of any good links that would be suitable to add, please let me know. There seems to be quite an interest in Info for Non-residents in particular. I've had a flurry of inquiries from Candians living in the U.S. and Americans wanting to invest in Canada lately. I have two brokers providing me with info on the subject and will fill you in with an articles soon.