Finding a Net winner for the holidays gets harder

"Last year, we saw a ramp about this time that lasted through April," said Jim Preissler, a PaineWebber analyst. "But this year, I fear the great returns we've had since August may leave people hard-pressed not to think about the profit they've made in a short amount of time and take profits in November."

The value of many Net stocks has soared in the past two months for a couple reasons: Investors went bargain hunting after a summer swoon and they bought holiday plays early. Preissler said this could cause many investors to cash in their quick profits well before the highly anticipated holiday season ends.

Amazon, for example, is now trading at about 80, nearly double its 42.75 price on August 9. And toy retailer eToys is trading at about 75, up from 30 that same day.

While the easy money may have already been made, there are some trends and expectations that investors should be aware of when looking for potential holiday movers.

Analysts say the industries that are expected to capture consumers' attention will go beyond books and music this year. As a result, e-commerce sales are expected to top $12 billion, up from roughly $3 billion last year, according to Preissler.

"We'll see a broader range of consumer products, like electronics, apparel, and jewelry, do well," Preissler said.

Brick-and-mortar electronics companies, such as Circuit City, are expected to do well with their Internet sites, as well as apparel makers like Gap.

The average purchase price for items was under $100 last year, but consumers this year should be willing to open their wallets a little more, said Anthony Noto, an analyst with Goldman Sachs.

Sites specializing in gifts, such as florists, also are expected to enjoy a strong holiday season, said Mark Rowen, an analyst with Prudential Securities.

And Internet florists could definitely use some help. Both 1-800-Flowers and Ftd.com today are trading below their IPO prices.

Meanwhile, books, music, and toys are again expected to generate a sleigh full of sales.

"Amazon will be the key beneficiary of the holiday traffic," Rowen said. He noted that the giant bookseller has increased its warehouse space and distribution to handle the expected surge in business.

The expectations for strong sales are both a blessing and a curse, analysts say. In some cases, e-tailers' ability to meet demand will be tested. This holiday season also could result in a shakeout for those who fail to capture a large piece of the pie.

"Christmas will be a defining moment that will separate the best from the rest of the players," Noto said. "There will be clarity after Christmas of who will be the leaders."

For those investors who missed the boat for this year, early next year could provide a good time to invest. Auction sites, which have performed well during the year, aren't expected to ride the wave of holiday sales.

"The auction sites will be strong in October and November, but will slow down in the last two weeks of December. I wouldn't expect a seasonally strong quarter for auction sites because of this slowdown in December," Rowen said. "They'll probably pick up in the first quarter, when people are trying to sell all the Christmas gifts they don't want."