COMMENTARY -- Thursday ramblings:
AOL has to bear much of the blame, especially given its supposedly strong contacts in Washington, D.C. Steve Case and his team knew going in that regulators would want hefty assurances about open access to the cable lines and Time Warner (NYSE: TWX) content. Had he provided them at the very beginning, this would be a done deal.
In light of AOL's stock depression all year, shareholders have a right to ask why the companies didn't offer large concessions sooner.
Because only financial columnists, gamblers and other foolish people defy trends. Analysts rarely concern themselves with trying to figure out when to sell; all they care about is when to buy. In the case of Broadvision, a downgrade is not a difficult thing to imagine, because the stock remains expensive compared to the rest of the market.
Broadvision has been sliding all year, and considering that the stock is still valued at more than 90 times estimated earnings for the next 12 months, or a multiple more than 60 percent above that of Oracle (Nasdaq: ORCL). At that level, it's easy to see plenty of air remaining beneath BVSN's current market value.
Maybe you can justify its valuation -- doubtful, but anything's possible -- but no one can say with certainty that Broadvision is going to start rising again. That's reason enough to be neutral on the stock.
The downturn in online trading activity means brokers have to work harder than ever to attract customers. Is it really the time to make cost cuts that inevitably affect quality of service? Internet trading already has a bad rap for slow execution and bad customer service; reining in improvements might only serve to drive more traffic back to the traditional brokers.
"Clearly, consumers are embracing the benefits of online shopping," BizRate.com CEO Chuck Davis declared.
I wouldn't be so sure that this marks some kind of greater belief in the Internet so much as simply bargain hunting.
BlueLight.com CEO Mark Goldstein a couple of weeks ago told me he has been surprised by the heavy promotions coming from competitors, particularly Amazon.com (Nasdaq: AMZN). You can find e-tailers offering deep discounts, free shipping and other moves that will take their toll on margins.
So even if revenue has started surging, it might be coming at an unexpectedly heavy price for the retailers. At this point in the development of e-tailing, I'd rather make money. 22GO>