The CNET Networks Internet Services, Internet Content and E-Tailing indexes posted gains of at least 18 percent from April 1 to May 4. The E-Tailing index jumped 41 percent, led by Amazon.com.
Although some analysts say the gains could be a short-term rally, a lengthy list of mostly under-$5 stocks showed significant jumps.
USB Piper Jaffray analyst Safa Rashtchy said in a research note that there wasn't any significant news to warrant the dot-com gains and that investors are trying to find the bottom for Net stocks.
"This is in sharp contrast to earlier this year when the stocks were in freefall and no identifiable bottom was visible," he said.
But the recent gains may not stick until companies show some business improvement: "Major movement beyond these levels would require new catalysts," he said.
Leading the gainers was GoTo.com, which jumped 197 percent from $7.37 to $21.92 between April 1 and May 4. In the same time period, InfoSpace surged 146 percent, from $2.03 to $5; Ask Jeeves jumped from $1 to $2.24; iVillage doubled from 50 cents to $1.06 and Yahoo was up 44 percent.
Even TheGlobe.com, recently delisted, jumped 60 percent, or 15 cents to 25 cents.
Among the downtrodden Internet services companies, Razorfish jumped during the same time period from 46 cents to $1.25, or 167 percent, and CMGI surged from $2.39 to $6.22, or 160 percent.
Among Internet retailers, the biggest gains were registered by Expedia, which posted a profit, jumped from $13.87 to $31 from April 1 to May 4. Expedia rival Priceline.com surged from $3.06 to $6.08 after projecting an operating profit in the current quarter. Amazon was up 93 percent from $9.10 to $17.56.
Like the other dot-com players, e-tailers in the soon-to-be-delisted club had nice runs. A 6 cent investment in E-Stamp would have given 22 cents. A 21 cent April 1 investment in Buy.com would have brought home a 37 cent return.
Rashtchy said he's beginning to see early indications of a potential comeback in online advertising and technology spending.
"A number of our contacts have indicated that the advertisers and technology spenders are beginning to ask for proposals. While no one has committed to major spending yet, these indications, combined with new products in online advertising, increase our hope for a fourth-quarter recovery," he said.
Salomon Smith Barney analyst Lanny Baker agreed, with advertisers going with winners, and that could eventually boost the sector.
"The worst is most likely behind us in terms of stock performance for online media's leaders," said Baker. "Looking ahead from here, one important question still needs to be answered: How fast might online advertising spending grow in 2002 and beyond?"
Baker noted that there isn't an answer to that question yet, making the stock valuations of online content providers "fairly speculative and convictionless."