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Monday, August 29, 2005

Internet Stocks – Are Back in Fashion…

Posted by @ 9:53 pm

The stigma of bygone IT stock market booms and busts seems to have faded, as is evident by the recent spate of mergers, takeovers and the unprecedented prices of some the internet’s heavyweights’ shares.

So are internet companies, the “in” flavor of the investment market again?

It would appear so:

…and with good reason. Search engine marketing is more than demanding it’s share of the corporate advertising wallet. With the world’s iconic brands showing the way, pulling significant funds from traditional advertising, to pump into the highly measurable and effective SEM arena, the internet is once again hot property, and looking more sustainable than ever before.

The strength of the internet marketplace, has meant that some of the web’s most recognizable real estate is hot on the list of investors worldwide. Not only are internet based organizations consolidating their positions, but traditional media company’s are seeing this as the prime opportunity to gain a strong stake in new markets.

Let’s recap some recent merger/takeover headlines before we speculate who is next on the acquisition hit list:

Some of the notable acquisitions recently include IAC/InterActiveCorp’s agreement to pay $1.85 billion for Ask Jeeves, Yahoo!’s move on Flickr, Hewlett Packard securing Snapfish, while The Washington Post Co. purchased Slate, New York Time Co.’s purchase of and Dow Jone’s purchase of, worth about $410 and $580 million respectively.

The well publicized recent purchase of stakes in and by Google & Yahoo! highlight the global expansion that internet investment is taking. Overseas markets are following the trends and making international internet real estate extremely attractive with favorable purchase prices and high growth prospects.

So who is next on the acquisition and merger shopping list?

Well here is a quick list of some of the internet’s more attractive prospects: – wedding planning site – market cap of $230 million – news site – valuation of $1.9 billion
IGN Entertainment – gambling site – hoping for $1 billion – potential IPO
TiVo Inc. – digital video recording provider
InfoSpace Inc – search and mobile phone services – photo hosting and sharing service – informational resource

But where does it end…it is only controlled by the size of your wallet, and everything’s for sale if the price is right. Keep you eyes peeled for more and more interesting mergers and acquisitions as the internet investment market hots up while expansion and consolidation rule the game.

With Google just about to release another $4billion worth of shares, this provides them with enough cash to grow by acquisition. Microsoft – with many billions in cold hard cash – are also cashed up to purchase complementary services or technology. Yahoo! have also proved they are not afraid to spend money to grow (just look at their purchase of Overture some two years ago). With all this interest in “dot com” stocks, it is becoming a sellers’ market again. Almost feels like 1998 all over again.

This article was written in conjunction with Rene LeMerle, ineedhits Online Marketing Specialist.

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