Net stocks trade higher

Internet issues of all types continue to climb as the holiday approaches.

3 min read
For the second consecutive day, Internet pixie dust pushed virtually anything with an Internet connection higher in stock trading today.

That includes not just Net stocks, Internet auction issues, and cyber-retailers in general but even companies like Playboy that rose, closing up 14.625 percent, on the mere suggestion it might spin off its Internet operations in a separate IPO. Computer publisher Ziff-Davis climbed too after announcing yesterday that it's spinning off its ZDNet online operations in an IPO, propelling it upward 19.81 percent.

The biggest winner was computer direct marketer Multiple Zones International, which rocketed from 11.4375 to 56, up 389 percent, on news it introduced an auction site on its Internet superstore to boost computer sales. Privately held auctioneer Fairmarket is running the bidding.

One of the few Internet retailers to drop was Cyberian Outpost, which reported big losses yesterday but beat analyst estimates. It fell 11.07 percent today to 33.125. Investors apparently are judging Outpost on past performance, while much of the market's rise today reflects future hopes.

Preview Travel and E*Trade, which announced a holiday promotion through Monday, were up 24.19 and 16.42 percent respectively, and newly public Ticketmaster/City Search shot up 32, or 65.98 percent, after analyst Axxel Knutson at Axxel Institutional Equity Services upgraded the stock to a "strong buy."

"Because Ticketmaster is profitable, it will be a strength," said IPO Value Monitor analyst Steven Tuen, who thinks the firm's ticket sales business is particularly well suited for online sales. Amazon.com, Lycos, and Yahoo also traded higher.

Online retailer iMall's stock shot up 135 percent yesterday, following news that it was in a deal with AT&T WorldNet to offer the Internet service provider's users discounts on its new shopping site, Stuff.com. Investors were bullish on the online retailers deal because it gives the shopping site access to a large number of eyeballs, ergo potential customers, according to Commonwealth Associates analyst Indur Tallur. Today, the stock edged down 6.125, or 21.49 percent at the bell.

"WorldNet has 1.3 million users and you can attract that traffic to the [iMall] site," Tallur said.

Big Entertainment rose as much as 1.3125 to 13.0625 after the entertainment company said it will promote its movie merchandise, such as apparel, collectibles and toys, on Broadcast.com's Web site. Broadcast.com rose as much as 12.25 to 98.75.

CDNow rose as much as 5.50 to 26.25 on rumors reported by ZDNet that Time Warner, the world's largest media company, might buy or invest in the online music retailer.

Sharper Image rose as much as 2.375 to 15.25 after the retailer of unusual gadgets and electronic toys said Net sales from its Web site grew sixfold for the period December 1-21. The company said the improvement in gross margin and increased sales in December will significantly affect this year's earnings. (See related story.)

href="http://www.ubid.com/">uBid, which went public December 4, continued to surge, pulling its parent higher. uBid was up 53.50 to 188. Creative Computers, which owns about 80 percent of uBid, traded up 12.7656 to 59.6875. uBid rival Onsale nudged down 0.50 and high-flier eBay, which yesterday suffered its fourth brief outage this month at its personal-auction site, dropped 3 to 298.

Online bookstore Computer Literacy rose as much as 1.75 to 15.25. Online music retailer N2K, which runs the Music Boulevard storefront, increased 3 to 18.25. WavePhore rose 1.9375 to 10.0625 on news of deals to distribute content from Time Warner's Warner Brothers Online unit and News Corp.'s News America Digital Publishing on WavePhore's nationwide broadcast network.

Zapata, after saying today that it's back in the Internet business, finished up 7.0625 to 14.25. The fish-oil and meat-casings company also said it will reintroduce its home page in the next few weeks.

Bloomberg News contributed to this report.