Ticketmaster rallies on outlook, coverage

2 min read

Shares of Ticketmaster-CitySearch Online Inc. (Nasdaq: TMCS) shot up 2 7/16, or 11 percent, to 25 7/16 Friday after Thomas Weisel Partners started coverage of the stock with a "buy" recommendation.

The rally comes a little more than a week after its shares hit an all-time low of 21 9/16 on June 15. The stock was trading at 80 1/2 shortly after its initial public offering in March.

Although the three-way merger between it, USA Networks Inc. and Lycos Inc. (Nasdaq: LCOS) went up in smoke, some analysts believe Ticketmaster is on the right path.

Keith Benjamin, an Internet analyst at BancBoston Robertson Stephens said he expects the stock "will recover sharply, helped by strong numbers" in its second quarter.

Last quarter, Ticketmaster topped Street estimates when it reported a loss of $17.7 million, or 28 cents a share, on sales of $15.9 million.

First Call consensus expects it to lose another 37 cents a share in its second quarter and $1.42 a share in the fiscal year.

"We believe TMCS stock has lagged the group because of lack of news and the general glut of new stocks," Benjamin said in a research note. "We continue to be impressed with the strong growth not only in the ramp of CityGuide rollout but also in ticket sales and other e-commerce activities."

Ticketmaster has also expanded its breadth of services through the acquisitions of CityAuction, a leading local Internet auction site, and Match.com and oneandonly.com, two popular online personals sites.

"We have seen a constant flow of positive announcements beginning with positive first-quarter earning results when ticket sales were double our estimates, continuing with the acquisition of two leading online dating sites, and most recently the announcement of this partnership," Benjamin said.

Ticketmaster shares are rated either a "buy" or "strong buy" by three of the four analysts following the stock.