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OF THE WEEK:
"Rising interest rates mean an improving
economy, which is good for [commercial] real estate, as long
as they do not rise too much."
CEO of the Durst Organization,
builder of 4 Times Square in NYC, the first "green" skyscraper
SECRETS OF CEOs: How do you make your dream business come true? iSophia asks Kay Koplovitz, who became the first female network president in television history, when she founded USA Networks in 1977. In an exclusive interview with iSophia, Ms. Koplovitz gets very specific about building your dream business, from teamwork and networking to raising venture capital.
10: Live like
royalty on a reasonable budget, but never get caught being
cheap. Tips on when to penny pinch, where to use coupons
and when it pays off to pony up the dough.
Report Card: Biotechs
are still beating most other stock sectors out of the
gate. We've found a few promising geldings (for gamblers),
an undervalued champion and a Nutty Professor jockey,
for your summer stock consideration.
Guide to the Market: How to Create a Portfolio With Pocket
the past eighteen months, while so many investors were
hiding from the bear market, the WIN, Power of Ten investment
club in Santa Monica has doubled their portfolio. These
bold friends meet monthly, pool $100 each, and now have
over $28,000! Discover how they overcame their financial
up for Prosperity. Why
Affirmations are the First step to Improving Your Fiscal
Health… By Chellie Campbell, author of The Wealthy Spirit.
Investments can Drive a Stock up or Drag it Down. Check out the Top 10 institutional picks and pans of the week.
morning chat with financial guru, Chellie Campbell.
A Great Balls of Fire gala event to protect our nation's
men from one of the most deadly killers on the planet
in the News… News
highlights, as reported by the most respected sources
in the world. Alphabetized for easy reference.
SECRETS OF CEOs:
The founder of USA Networks and the first woman network president in television history.
How do you make your dream business come true? iSophia asks Kay Koplovitz, who became the first female network president in television history, when she founded USA Networks in 1977. In an exclusive interview with iSophia, Ms. Koplovitz gets very specific about building your dream business, from teamwork and networking to raising venture capital—when
to bluff, hold ‘em, fold ‘em and when the best bet is to
walk away from the deal.
times the best deal you make is the one you don't make."
Kay Koplovitz, 8.4.03
N. Wynne--Lets put a few things in perspective. We live in a completely different world from our grandmothers AND our mothers. 100 years ago women couldnt own property or vote. In the early 1970s, women still owned less than 5% of American businesses. By 1998, however, women owned 9.1 million enterprises, contributed $3.6 trillion to the GNP annually, employed over 27.5 million people, but received less than 1.7% of venture capital funding. In 2002, women owned 49% of American businesses operating in the U.S., generating +$1.15 trillion in sales annually. (source: US Census Bureau). Thats odd, isnt it? How did the GNP levels drop so drastically in only two years?
Koplovitz--The U.S. Census Bureau changed the measurement
statistics. When the numbers were quoted in my book, they
were measuring businesses that were at least 50% owned by
women. In the new census, they changed it to 51%. I question
that rationale. Why would a business that is owned 50% by
a woman be a male-owned business? Because they changed that
measurement, it changed the number of businesses and the
amount of revenue.
Wynne--Has the Springboard venture capital forum, that you
launched in 2000, been as effective at getting venture capital
to female entrepreneurs as you'd hoped it would be? What
percentage of venture capital is going to women-owned businesses
Koplovitz--The percentage of venture capital currently going
to women has risen to about 6%. The total amount of money
has dropped, however. In 2000, $100 billion was invested
in venture capital. Venture capital investment has dropped
rather dramatically to only $25 billion invested last year.
But it's the percentage of the amount that we are looking
at. The market volume will change with economic conditions.
We had a downturn in the economy. The percentage of venture
capital going to female entrepreneurs has more than tripled
since Springboard began, and since I've been looking at
Wynne—That success must give you some satisfaction! Let's
talk about how venture capital is distributed between early
stage, late stage and mid-stage companies. In 2001, according
to Venture Economics, the concentration of venture capital
went to existing (and presumably successful) companies that
were interested in expanding, with only about a quarter
of the funds going to early stage companies. Is that true
Expansion, mid-stage companies
Venture Economics, 2001
Koplovitz--The numbers have shifted to later stage companies,
with only a very small percentage going to early stage investment.
Investors have retreated to safer ground. This last quarter,
the second quarter of 2003, is the first quarter of five
quarters that we've seen a very slight up-tick in the number
of new company investments. Some venture capitalists believe
they will make a number of investments in new companies
this year. There is a cautionary sign of a pickup. Funds
are sitting on a considerable amount of capital that they've
not invested. They've purged their portfolio of bad investments
or investments that they no longer want to support. They're
not sitting with a lot of companies in their portfolio,
so they'll start moving to new investments. Biotechnology
has probably been the lead in that, although technology
and wireless have gotten a considerable amount of attention,
Wynne—Should entrepreneurs consider moving to Silicon Valley,
where most of the venture capital is located?
of Venture Capital Funding.
- 31.4% Silicon Valley
Koplovitz--No, Silicon Valley was one of the hardest hit
sectors of the country in the technology downturn. Silicon
Valley still has the largest pool of capital to invest.
They still lead, but they no longer dominate. Boston is
the number two market for venture capital. Boston has been
consistently stronger throughout the downturn.
N. WynneAt least theres hope on the horizon for the commercial real estate developers, who have suffered through such high vacancy rates over the past few years. One of the things highlighted in your book is that the venture capital world is still largely run by white males, with the notable exception of Pat Cloherty, Ann Winblad and Susan Segal. Does this fact have any bearing on the way that female entrepreneurs should approach venture capital funding?
Koplovitz--I think we're still in the period of training
women to present to venture capital in the terms that VCs
are used to dealing with. Not only the language, but also
by addressing the important business points that venture
capitalists want to know. They want to know the product
or service, competition, management team, exit strategy
and how close you are to liquidity. In this downturn time,
most firms are looking for profitability or breakeven in
twelve months. If you're eighteen months from profitability,
it's difficult to get financing today, except for biotechnology.
It's understood in that category that it's a longer tail
to get through research and development, testing and FDA
approval, etc. Women should know the fund they're pitching
to, which companies that fund likes to invest in, and what
stage your company is in, before you spend your time and
their time trying to present your business for capital investment.
Human capital is still very important. Who introduces you
is extremely important.
Wynne—One of my advisors says it's important to get a company
out of cash burn before going to venture capital these days.
The idea is that if the VCs sense that they can squeeze
you into a cash-crunch corner by dragging their feet, they'll
do that and buy into your company at fire sale prices.
Koplovitz--A profitable company is always more interesting
to investors. On the other hand, if you're a profitable
company, why do you need the investors? Only if you're looking
for capital for growth. It's definitely easier to look for
investors if you're a profitable company.
Wynne--In your book, Bold Women, Big Ideas: Learning
to Play the High Risk Entrepreneurial Game--which I
believe is a must-have handbook for any entrepreneur, male
or female, who is interested in navigating the world of
venture capital--you say that the right venture capitalist
can be enormously valuable to a company, in more ways than
just ponying up the cash. How does an entrepreneur go about
targeting and evaluating the right VC, when most entrepreneurs
would dance on the ceiling just to get a meeting or even
a telephone conversation with any one of them?
Koplovitz--I think the first thing that an entrepreneur
should do in searching out potential venture capital investors
is to really take a close look at the companies they have
invested in, to see what their appetite is for the company
that you have. Look at the stages that the firm invests
in. See who is on the board of the companies they invest
in. See what kind of people are around them. An entrepreneur
needs guidance, introductions and experience in the financial
market. A venture capitalist can bring business contacts,
and also an expertise in your type of business. If you're
in wireless, and if you go to a venture capital firm that
has one or more partners in that category, they will have
experience that will be useful to you. They will also have
a network of people to introduce you to. Look at the firm
with the question, "Can they help you out?" It's
not just about the money. It's about building the business.
You've got to focus on building the business. Entrepreneurs
fall short on revenue and business development. The true
revenue streams aren't always carefully thought out or understood.
Therefore it's hard for the business to withstand the market
Wynne—Ah! So profitability is back in favor, rather than
the cash-burn strategy of capturing market share at any
cost? (I can't help but thinking Amazon,com here…)
Koplovity--There was a time, in the late 90s, when businesses
were fed so much capital. There was a concentration on top
line revenue, no matter the cost. A lot of capital disappeared
with that economic model. It's not the case that profitability
doesn't count. Revenue, relationship to cost, and profitability
are extremely valuable to general investments.
note: Again, we can't help but thinking Amazon,com here.
Amazon.com is the most visible brand in the world, but did
you know that the company is sitting on a mountain of $2.8
billion in long-term debts and has only had two profitable
quarters in over five years of doing business? The Earnings
Per Share quarterly growth rate in 2Q 2003 was -267%, according
to Money Central. For a debt-free competitor, check out
Overstock.com, at OSTK.)
Wynne—Is there a time or circumstance when the best decision
an entrepreneur can make is to walk away from the offer?
What is the value of focusing on friendly funds?
Koplovitz--Oh yes. Many times the best deal you make is
the one you don't make. That's true of mature and new businesses.
You've really got to understand the economic model of your
business and what that deal will bring to you in value.
If it's not a good value or at least an acceptable value,
if the deal does not bring an added value to you, it's not
a good deal to make.
frequently see entrepreneurs make deals because they think
that making deals shows progress for the company. Making
a bad deal may bring down your company. You may set a bad
precedence by making a bad deal. You have to weigh the value
to make sure that it fits in the economic model that works.
Rarely do models work out exactly as they're planned. There
are always modifications. You might give up something for
something extraordinary and helpful, but don't sell yourself
out for something that might ultimately hurt your business.
Wynne—Assuming one of our readers draws the interest and
an offer from a venture capital firm, what other offers/deals
can she ethically court during due diligence? I'm thinking
of the way that you negotiated Warburg and Travelers during
the term-sheet negotiations for Broadway Television Network.
Koplovitz--I think there's nothing wrong with negotiating
with different sources of revenue. You get to a certain
point where in order to finish due diligence you have to
make a commitment. One thing about the market is to engage
in multiple business deals. Business deals don't always
get concluded, even when both parties want to do it. I think
that's true in investments, as well. You need to talk to
different firms, to get a sense of what their assessment
of your business is, so that you have an idea of the market
for your business from an outside funding source. At some
time, you'll sign an exclusivity clause in order to close
Wynne-- What key data and/or statistics do you think are
imperative for a great business plan, and how do you write
up the revenue and costs of a new business that has yet
to prove itself?
Koplovitz--There are many places you can go. You can go
to business schools to get a business plan template, or
to the Ewing Marion Kauffman Foundation, out of Kansas City.
The Kauffman Foundation is solely focused on entrepreneurs.
There is much value on their web site, as well. (WIN note:
Click here or go to: http://www.emkf.org.)
Most any major university has business plans available.
There are also a variety of different associations, like
the National Venture Capital Association and SpringboardEnterprises.Org,
that have business plans, as well. There are numerous places
you can go.
Wynne--Will you talk a little about how entrepreneurs can
get their elevator pitch down to a delicious sound byte?
Koplovitz--I think trying it out, getting your pitch corrected
to the ear, is very important. It's easy to record it, and
listen to it yourself. You'll see holes in your own pitch
by doing that. There are a number of associations--venture
capital associations, and groups in and around universities--where
people congregate to listen to their pitches. If you go
to a VC forum and hear other pitches, you'll get a pretty
good idea of who does it correctly. Springboard Enterprises.Org
has a list of various elements of things that should be
included, and examples of people who have done it well.
IF you want to see some examples, you can see that on Springboard
Enterprises.Org. It will give you several examples of people
who did sections of the pitch very well. A lot of people
get presentation training. A good presentation trainer will
help you get the flaws out of your pitch, not only in the
material itself, but also in the presentation of the material.
Wynne--Let's talk about starting out—getting the first loan
or seed money. The SBA may be perceived as being friendly
to female-owned businesses, but loans aren't given out to
any business with less than two years of income returns.
Unfortunately, according to research by the Milken Institute
in 2000, women are getting only 12% of the debt financing
through traditional banks, even though female-owned businesses
accounted for 1/3 of GDP. Where does the startup capital
come from and what changes are occurring to make the debt
financing world more female-friendly?
Koplovitz—Those numbers may have gone up a bit, like 15%
today. Female-owned businesses are still woefully undercapitalized,
whether it's debt or equity. I think that a lot of women
who were rejected in the past from banks, should, however,
try again. Twenty-five years ago, unless your husband or
your father was signing for you, banks wouldn't talk to
you. I think that there are banks that have concentrated
units that are looking to fund women and minority-led businesses.
Some have made more progress in providing assistance to
people who are looking for debt financing. Times are changing.
One should inquire at their bank of choice, to see if there
is a unit that is dealing with women-owned businesses. At
least go there and get their input. Some will give guidance
on accountants and lawyers, if your financials aren't in
the shape that they need to have. That would be another
source of information that would be helpful.
Wynne—What about credit cards? We hear success stories about
entrepreneurs who started their businesses on credit cards,
and, of course, we never hear the horror stories.
Koplovitz--People are paying very high interest rates on
credit cards. Today, you have a bank account yielding less
than 1%, and you're paying 16% on credit card money. That
doesn't add up. You're not going to be able to borrow money
at prime or even prime plus two. Refinancing mortgages has
been attractive in more recent months because of the low
interest. If you're willing to do that and can do that,
maybe you're taking a variable at 4%. That is quality money
at a better price than paying on your credit cards at 16-18%,
although mortgage refinancing requires you to have something
with a mortgage.
Wynne—That's quite a decision, deciding whether or not to
put up your home to fund your dream business. Successful
entrepreneurs tend to be "whatever it takes" kind
of people. Perhaps that's the challenge of entrepreneurialism,
to make sure that tenacity and bravery do not spill over
Wynne--Why does the word networking appear so many times
in your book?
Koplovitz--You just don't build businesses alone. You really
need, not only to attract good people to work for you, even
if it's three or thirty or three hundred, but you need also
to have a customer base. You need to market yourself. Most
of that is done through networking, to get new customers,
to get new opportunities to market. It's not all buying
ad time. Not all products warrant that. Some are business
services. You have to get customers who are satisfied with
your service and are willing to speak about that to others.
In television and in the movie business, we call it buzz.
There is a lot of word of mouth, regardless of the tons
of advertising. Word of mouth makes and breaks movies. It's
still an example of meeting to spread the word. Networking
spreads the word. You have an important product or service,
or a customer who is satisfied, or an investor who thinks
you're going in the right direction. You have to have the
clarion call. You have to be an evangelist for your business.
You need to tell everybody you know.
Wynne--You say that it's better to own 10% of a $100 million
company than 100% of a $1,000,000 company, and a whole lot
better than owning a company that has to close up shop for
lack of capital. On the other hand, however, when USA Networks
sold in 1997 for $4.5 billion, you had zero equity. How
did you learn this lesson the hard way? Most people whom
I relate that statistic to think that you must have had
a bad attorney or executive recruiter. In today's world,
stock is handed out so liberally to executives.
Koplovitz--People don't understand what 1977 was like. You
couldn't finance television properly, much less a cable
television network. Venture capital and equity ownership
simply didn't exist at the time in cable television. Bob
Pittman tried to take MTV public, but no one thought the
cable business would amount to anything. That's a short
course in history. Executives in the emerging market of
cable television got big pay-outs, but equity ownership
was a different issue. USA Networks was a privately-held
company in a joint venture. You can't even compare the two
worlds. That doesn't mean that I didn't earn a lot of money.
It just means that I didn't have equity.
Wynne--You've launched two companies that have changed the
world. USA Networks introduced satellite sports and launched
cable into television network programming. Springboard is
bringing women into the venture capital arena. What do you
see as the future of Broadway Television Network? Will this
venture be as big and bold? Will viewers eventually see
Chicago, the Broadway production at an IMAX theatre?
Koplovitz-- IMAX is a different technology. Broadway TV
is bringing Broadway musicals or event TV to the big screen.
The multiplex theatres have started to project things other
than movies on their screens. They're looking for other
ways to utilize their real estate. They're looking at sporting
events, Broadway shows, etc. If theatres put more people
in the seats, they benefit from the bottom line. If you
don't live close to New York City, and if you want to see
the real Broadway cast in front of an audience, Broadway
Television brings you that experience. It's really spectacular
in high definition, Dolby sound and on the big screen, but
Broadway Television Networks is only one of my investments.
Wynne—True. Homeowners, gardeners and investors might be
interested in learning more about AgraQuest, a company that
makes natural pesticides. This company was one of the first
investments made by BoldCap Ventures, Kay Koplovitz's angel
capital organization. For more information on AgraQuest,
go to www.AgraQuest.com.
Koplovitz is a principal of Koplovitz & Company, a media
and investment firm. She is also the Chairman of Broadway
Television Networks, and serves on the boards of Instinet
and Liz Claiborne. From January 2000 to August 2001, Kay
was the CEO for Working Woman Network. As the Chairman of
the National Women's Business Council (under President Bill
Clinton), Ms. Koplovitz co-founded Springboard.Enterprises.org,
a nationwide venture capital forum for female entrepreneurs.
Kay Koplovitz became the first female network president
in television history, when she founded USA Networks in
1977. Ms. Koplovitz is the author of the entrepreneur's
must-have handbook, Bold Women, Big Ideas: Learning to
Play the High Risk Entrepreneurial Game.
like royalty on a reasonable budget, but never get caught
being cheap. Tips on when to penny pinch, where to use coupons
and when it pays off to pony up the dough.
- Waldorf=Astoria. It happens only once a millennia, and were not talking about the love story of King Edward VIII, more commonly known as the Duke of Windsor, abnegating his throne to marry Wallis Simpson. The world-class Waldorf=Astoria is offering a two-night package deal that includes two, two-day New York passes with up to $600 value in entrance fees to 40+ of the citys most popular attractions, for just $461.50. Call now to book your reservation at 1.800.WALDORF, quickly before the sales director comes to his senses! Discounts include Bloomingdales, Macys, Broadway tickets, Tavern on the Green, entrance to the Empire State Building and Museum of Modern Art, and more.
Parks. Theme parks offer all kinds of discounts, you just have to ask for them. AAA cards, Honors cards, American Express. Group discounts. During the summer, many fast-food restaurants have discount coupons that will save up to $6.00 per person. (One coupon is typically good for the family.) Goofy wont call you cheap, and you can splurge guilt-free on that over-priced funnel cake.
Internet Hot Spots. They are advertised as free,
but unless you're on the T-Mobile Wi-Fi plan, going
on-line at a T-Mobile hot spot, like Starbucks, is going
to cost you anywhere from $6.00 (for one hour of online
time) to $39.99 (for the monthly plan). The Queen for
a Day solution? Many hot spots are still free! In NYC,
try the Intercontinental Hotel (right across from the
Waldorf and the W). On the West Coast, there's a great
hot spot with delicious fresh fruit boba drinks--the
Relaxstation Café in Westwood. In general, your
best bet for free Internet access lies with the independent
chains and the mom and pop businesses. The mega corporations
are already banking on gouging your wallet with promises
of "free" IT access that require additional
monthly sign-up fees.
in Manhattans (day-time). In NYC, public transportation
is not only WAYYYY cheaper, but it is also FARRR faster!
Many locals, even the rich and successful ones, have
a Metrocard slipped between their platinum Visa and
AMEX. If you want to spend your time in NYC enjoying
the sights, museums and shows, instead of trying to
find a cab during rush hour and inching along in congested
traffic, descend the stairs and place your fate in the
hands of the friendly employees at the subway kiosk.
They'll help you navigate your way around the city,
and get you there for just $2.00 each way. I made it
from mid-town Westside to a meeting on the Upper East
Side in under twenty minutes during rush hour, using
the subway (and little speed walking). Trains come by
every few minutes. Late at night, cabs are a better
choice, however, when the trains run less frequently
and the clientele thins out.
in Santa Monica and from LAX. Cab ride from LAX
to Santa Monica is under $35, and taking taxis in and
around the city can be as reasonable and convenient
as catching a cab in New York City. Save your friends
the trouble of picking you up from the airport and watch
their hospitality blossom! Once your friends are free
from the obligatory hour-long or more commute to the
airport, they may spend that extra time planning the
perfect celebration for your visit! (The airport commuter
vans are worth the dough out to the valley, but taxis
are NOT the best solution for people staying in the
valley or suburbs or for people who are going to visit
every Southern California theme park. Theme parks can
be hundreds of miles apart!)
Marcus and Barney's fall sales. They get you in with promises of 50-75% off, in hopes that youll fall in love with the full-priced de riguer goods. Limit yourself to one full-priced pair of shoes or suit, walk away with at least two top-notch sales items and call it a steal! Put your husband, teenage son or lover to work swimming through beautiful women in search of the perfect shoe, and theyll cater to you all week (value: priceless!).
plans. If you don't already own a credit card with
a great mileage plan, apply now and start using it as
soon as possible. Put everything you buy on the card,
and you're likely to have at least a free weekend vacation
once every year or two. Most mileage plans are automatic,
easy to use and free, providing you pay off your credit
card each month. (Some require a small annual fee, usually
Orbitz, Expedia. These services are the best thing
to happen to the penny pincher, since the penny. On
Priceline, you can name your price for four and five
star accommodations, if you're willing to take your
chances on the exact hotel you'll end up in. There is
a trick to the process, however. (One that applies to
life.) Don't be discouraged by rejection. As an example,
for a trip last year to NYC, I offered $100 night for
a ten-night stay in a four-star hotel on the Upper West
Side. When my bid was rejected, I added five bucks and
a second area of the city—the Upper East Side. After
a few more area additions and slightly more money per
night, I won the Waldorf=Astoria, at a price that had
me skipping on the ceiling.
Orbitz, Expedia, and now Ritz Carlton? By now, if you dont use Priceline, Orbitz or another online discount hotel and airfare service, youre probably some scientist holed up in a laboratory trying to prove there is water (and therefore, life) on Mars or youre too cool to stoop so low. No need to. In todays world of low hotel occupancy rates (79% during the height of the summer season in NYC), a little flexibility with some of most exclusive hotels in the world can save you thousands of dollars. The Ritz Carlton in Laguna Niguel might be booked up solid and charging full fare, but if youll settle for Ritz Carlton New Orleans, you might buy a long weekend for the price of one evening. If youre willing to travel a little farther, the bargains can be so hot, theyll tan your skin. Shoot for the stars, and you may find yourself gazing at the moon, savoring pecan pralines and listening to Zydeco in Turks and Caicos!
yachts. Price to charter a yacht for a week in the Virgin Islands? $12,000 and up (depending upon size and luxury). Price to buy a yacht plus slip fees, maintenance, cleaning fees and taxes = $500,000 plus $20,000/year (minimum). How many times can you cruise to Catalina from Marina del Rey? Face it, the American coast doesnt offer the diversity that youd get by docking in the Mediterranean, in Greece or the Caribbean. While yachts may SOUND like a great investment to the desperate person who has convinced himself that he wants to buy, yachts are the first asset to get dumped in hard financial times. (I cant tell you how many yacht fire sales that Ive witnessed. More than warriors burned on pyres in The Iliad.) If you want a truly memorable, adventurous and somewhat cost effective experience, charter a power or sail boat for your next vacation, in the south of France (or St. Johns, or Greece, or
tap water. There's a joke that someone could bottle
the tap water in New York City and make millions. In
New York, where it rained nearly every day in August,
water is plentiful and clean. Don't waste your money
on bottled water! You may not know that some of the
best-known brands of bottled water you're drinking have
Chromium 6 in them (in trace "acceptable"
amounts). Exceptional bottled water that doesn't contain
Chromium 6: Coca Cola's Dasani and Pepsico's Aqua Fina.
Cheapo No No's. DON'T embarrass yourself by penny pinching
in public. It doesn't pay to be cheap on:
Never bring your own wine to a great restaurant, unless,
of course, you're bringing in vintage Chateau LaFite
or Cristal, and an extra glass for the maitre d', owner
AND executive chef. Corkage fees can run as high as
$25, and the wait staff will treat you like dirt, anticipating
that the cheap-o who brings her own wine also leaves
You can get your designer suit on sale, but don't fool
yourself into thinking that Benetton polyesters have
any resemblance to Armani. Wear the goods for important
business meetings, and save the polyester for casual
You might get lucky enough to find Giuseppe Zanotti
at Ross or Marshall's on the odd day, but, again, sales
are always a good thing, provided it's a classic cut
and worn in the right season. The cheap, no-name leather
shoes with rubber soles are cheap no-name shoes that
will give you blisters and ruin the great, first impression
you were hoping to make.
block and face products. It only takes once, buying
sun block and face products at the 99 cents store, to
learn the price of being cheap here. The problem with
second-run skin care products is that they can be OVER
A YEAR OLD. Putting dried-up sun block or face products
on your skin will end up costing you a trip to the dermatologist
and the expensive, prescription ointment to clear up
the rash! The only worse idea is lifting your own furniture,
to save the cost of movers, and winding up with spinal
You wear them every single day, and they are the first
thing that people see about you! If you change your
glasses just once a year, $500 glasses still cost less
(per day) than what you spend on coffee at Starbucks.
Thick, black rim frames work for techies and geeks,
but only when techies and geeks are in fashion (Think
2000, in the pre-bust Silicon Valley hey day! So last
are still beating most other stock sectors out of the gate.
We've found a few promising geldings (for gamblers), an
undervalued champion and a Nutty Professor jockey, for your
summer stock consideration.
know the biotechnology race is on when two out of the eight
stocks listed in this week's report card have done 3:2 stock
splits recently. You can still get in on the American
Pharmaceuticals 3:2 stock split for shareholders, if you're
interested in this company, by acting quickly, and buying
in by 8.18.03. (This bit of information should not to be
confused as a BUY recommendation. Read on!)
but no guarantees
of the companies featured in this week's report card are
positioning themselves as the future of genetic based therapies
and drugs, namely implanting drugs to the exact right target
in the body and then releasing the treatment in recommended
dosages over time. APPX, ANPI & ANSI all show great
promise, providing their pipeline drugs receive FDA approval
and their marketing and distribution agreements are with
experienced partners. Durect Corporation and Guilford Pharmaceuticals,
both of which are operating under negative earnings, have
had debt and operating pressures on the plate, but, with
new capital in place, have management promising to refocus
on product development and FDA filings. Guilford appears
to have a winner in DOPASCAN, a Parkinson's Disease drug
that is poised be approved in Europe and Japan soon. Additionally,
Guilford's most recent earnings report was better than expected.
Still Guilford has the highest debt/equity ratio on the
stock report card.
SEC has been very aggressive lately, reviewing pricing practices
of major players, like Johnson and Johnson and King Pharmaceuticals.
Additionally, governmental agencies are monitoring Medicare
reimbursements with an eagle's eye. Institutional holdings
decreased last week in Advanced Neuromodulation Systems,
Inc, even though the company had just adjusted their earnings
guidance upward, based upon worries that reimbursement rate
cuts will stunt future earnings growth. The heat on
targeted biotechnology and pharmaceutical companies may
present a buying opportunity, if you believe in the products
and the management and time your entry just right. Management
counts! Otherwise, you could end up with a HealthSouth fiasco.
Perrigo beats the numbers game over all of these young stallions,
as being best value, with established outperform potential.
This isn't a sure shot, however. Earlier this year, Perrigo
warned that the competition in the generic marketplace is
so fierce their earnings in 2003 may be flat. If Perrigo
proceeds with their plans to sell an over-the-counter generic
of Claritin in 3Q, however, better news for earnings and
share price could be in the cards. Remember, however, that
stocks are often more of a popularity contest than a strict
numbers game. If any one of the more high-risk stallions
(listed above) scores with an FDA approval, the long shot
odds stand to bring much higher, swifter gains for investors,
than the more generic companies, like Perrigo, which have
less WOW factor.
While scanning the net for unique biotechs, I found a rather oddball, nutty professor-type company--Spherix. Spherix is strictly biotechnology for commercial applications. Instead of cancer cures, these scientists have found (and patented) Naturlose, a low-fat sweetener that doesnt cause tooth decay. Pepsico is testing Spherix new low-cal sweetener, according to a recent Spherix press release. The FDA approved the sweetener years ago, but Spherix has just now worked out its manufacturing, distribution and royalty snags, and, thus, may be on target to bring in some seriously sweet revenue. Last week, another Spherix product, a longer-lasting fragrance compound won a patent. Fragrance companies have, reportedly, expressed interest. The founder of Spherix and his wife recently canceled their plans to sell shares, according to a company-issued press release. This company may, at long last, be on a roll, or at least a doughnut. Imagine Krispy Kreme doughnuts that dont rot your teeth!
FDA approval is merely the first hurdle in a series of manufacturing
and marketing challenges for any new drug (a process
which can take a number of years), companies that are hoping
for their billion-dollar bonanza can be highly volatile
investments. (Think of ImClone, which has yoyoed in share
price from five bucks to forty bucks in just a year.) For
the savvy investor, volatile stocks are profit-taking opportunities,
as easy as buying in at the low, and waiting for favorable
headlines to inflate the price. Trading around the core
has been a profitable strategy for many biotech stocks over
the last few years, including the reputable, well-established
Genentech (DNA). If you're looking for long-term investments,
remember that the cutting-edge companies are long shots
with as much high risk of loss, as there is potential for
high gains. Click here for
this week's Pharmaceuticals Stock Report Card.
a bonus this week, to help investors decide which biotechs
to add to their portfolio, iSophia is including an updated
Biotechnology Report Card from issue #34. Established giants,
like Johnson and Johnson and Bristol-Myer Squibb, are still
navigating through public problems that have adversely affected
their share price. Johnson and Johnson is currently embroiled
in a controversy over stent-related fatalities and an SEC
investigation, while Bristol-Myer Squibb went through a
year and a half of restated earnings, SEC scandals and the
FDA rejection of ImClone's Erbitux application. Bristol-Myer
Squibb may be making more positive headlines in the near
future, however. With the ImClone executive suite in disarray
(chairman and CMO positions were recently vacated and Harlan
Waksal is no longer on the team), analysts have speculated
whether BMY will take over ImClone completely. Erbitux continues
to dominate headlines, and is expected to get European approval
this year, as well as a new FDA filing. Johnson and Johnson
rates highly among money managers for strong management
and stability. Click here
for this week's Biotechnology Stock Report Card.
key factor that should be considered before any investment
is "word on the street." If you, or someone you
know personally and trust their opinion, swears by the product,
odds are there are others out there who will benefit and
buy. Do you have personal experience with any products of
the biotechnology and pharmaceutical companies? iSophia
wants to hear from you!! Join us for a biotechnology chat
session next Wednesday morning, August 20th, at 9:15 a.m.
does personal experience pay off? You're more likely to
watch a stock with a product that you swear by, which means
you'll stay abreast of the news, the share price and your
returns. In stocks, the watched pot does boil, and you want
to be there in time to take in all the bubbles before they
pop! If you're off doing other things, all of the returns
might disappear into thin air before you get a chance to
cash them out.
questions to think about before the biotechnology chat next
Wednesday morning? Are doctors aware of the benefits of
the implanted pain medications? Have the companies been
successful in getting the word out on the efficacy of their
even more information on the biotechnology sector, check
out WIN e-zine #34, an issue entirely devoted to biotechnology,
with particular focus on the companies with gene-based cancer
therapies, many of which have recently won fast-track FDA
note: the NataliePace.com does not act or operate
like a broker. We are a media and information center. This
article is intended to educate and inform individual investors,
and, thus, to give investors a competitive edge in their
personal decision-making. ALWAYS do your research and/or
consult an experienced, reputable financial professional
before buying or selling any stock. Full disclosure: N.
W. Pace does not currently own stock in any of the companies
listed in this article.
Guide to the Market: How to Create a Portfolio With Pocket
the past eighteen months, while so many investors were hiding
from the bear market, the WIN, Power of Ten investment club
in Santa Monica has doubled their portfolio. These bold
friends meet monthly, pool $100 each, and now have over
$28,000! Discover how they overcame their financial phobia.
I don't have enough money to invest! Doesn't it take
a certain amount of money to open a brokerage account?
brokers do require a minimum to open the account. (T.D.
Waterhouse's minimum is less than Goldman Sachs'.) If you
don't have a thousand dollars (or don't want to start by
investing a thousand dollars) consider joining (or starting)
an investment club. By pooling your money with your friends,
the minimum requirement shouldn't be a problem. $100 each
from ten friends equals $1,000 to invest each month. Learn
on the job, while your money does all of the work for you!
(Hey, if $100 is too much per month. It's your investment
club. You set the monthly dues.)
I would start an investment club IF I had the extra time
really has extra time and money? How about having a great
excuse to get together with your friends once a month? Why
not set your club dues at the amount of money you would
BLOW on a night. Then you really don't need extra time or
money. Ten members pitching in $100/each would have $1000
to invest each month, and $12,000 invested by the end of
the year! Ten members pitching in $25/each would have $1000
to invest in only four months, and $3,000 to invest each
year! A little $$ here, a little $$ there… pretty soon your
club has a real portfolio! The WIN, Power of Ten investment
club started in January of 2002, and has DOUBLED the value
of their investment in less than two years. Not a bad summer's
resolution—to start building a portfolio, worth almost $30,000,
Am I the only guy reading the iSophia online magazine?
From our statistics, at least a third of our readers are
male. Who wouldn't want to read iSophia's exclusive interviews
with Steve Forbes and Kay Koplovitz, or with rising star
executives, like Rick and Phil Smith, of Taser International?
Our reputation for finding the young mavericks of an industry
is becoming very established as well. (Did you know that
if you'd bought stock in the featured CEO's publicly traded
company when we featured them, your portfolio would be up
67% today?) iSophia: Smart enough for a woman, but guys
can get some action, too.
Aren't there some legal forms to file? Is it going to
cost me an arm and a leg just to get started?
a brokerage account is FREE, and is as easy as writing a
check and signing documents. Starting an investment club
is almost just as easy, when you purchase the iSophia Investment
Club Start-up Kit. iSophia's investment club startup kit
gives you everything from a sample member contract, to all
the facts and instructions you'll need to get going. Start-up
kits are just five bucks per person (if your club has ten
members), at $49.99.
I don't have time to research all this stuff.
does? That is why the iSophia network does the Stock Report
Card for you twice each month. Don't do the research,
just read the research. The rest of the time, kick
back, relax and apply your profit-maximizing strategies.
If you have a company that you're interested in, you can
email us with as much information as you know about the
company, including any personal experience that you've had.
We'll stick the company in an upcoming Stock Report Card
with its competition. Yes, we'll do the work for you! It's
called multi-tasking and networking, and it really works!
If you haven't already signed up for iSophia, the monthly
subscription rate is just $4.50. Get two months free, if
you sign up for a year. Call 310.399.0497 or email info@NataliePace.com
What if I lose all my money?
All investments, outside of cash, are risky, but the educated individual is more likely to achieve greater gains than the novice. The odds of greater returns improve statistically for investment clubs over individual investors (probably as a result of people actively working their investments and sharing their knowledge). Analyst recommendations are, statistically, a losing strategy. According to a study conducted by Stanford and UCLA in 2000, investors lost 30% by trading on analyst recommendation. Thats why iSophia was foundedto provide an enjoyable, easy forum for investors to network and educate themselves about making wise investment choices. If you really want to make more educated investment choices, be sure to sign up for Investors Boot Camp, a two and a half hour hands-on training that will change the way you invest for life. See this weeks CALENDAR OF EVENTS for the next seminar, to be held in Los Angeles on September 18, 2003.
your portfolio into a number of stocks in different sectors,
but don't try to hold more stocks than you can manage.
Keep cash on hand to get you through the low periods, so
when stocks (or other investments) dip you don't have to
liquidate at a loss. (Trimming losses is a strategy, but
you don't want to be forced to do it.)
Diversify your investments into real estate, stocks, bonds
and liquid-friendly money market accounts. Holding all your
money in one sector leaves you very vulnerable. Natural
disasters can wipe out real estate gains in a heartbeat.
Recessions can sink stock market gains in a season. Savings
accounts offer less risk, but almost no return today. Don't
underestimate the value of liquidity! Cash can save the
My broker's last hot tip was HealthSouth! Aren't all
on any ONE piece of information to evaluate investments
is not a smart, or successful strategy. Trading solely on
HOT TIPS from brokers or investor bulletin boards can often
simply be chasing after profits that prescient investors
are ready to cash in. Think of investments as a
Mosaic. The more tiles of information that you have about
any investment, the more complete picture you'll see. Don't
trust brokers blindly. Brokers are salespeople, who work
on commission. It's the entry-level position in the field.
Most of a broker's time is spent selling products to clients
like you, and taking deposits and orders, not in researching
the companies. Most are told what to recommend by their
I just don't know enough about investing!
Start educating yourself. What are you waiting for? Come
to an Investor's Boot Camp seminar. Sign up for iSophia's
investment network. Start receiving our bimonthly e-zine.
Join us for our Wednesday Morning online Chats with Industry
Professionals. At least you'll discover that adult P/E isn't
a place with smelly socks and communal showers.
Taxes have got to be a nightmare! More forms to fill
out and numbers to crunch! ACCCKKK!!
wouldn't want the headache of keeping track of PROFITS!!
Relax. iSophia software does the math for you (for just
$19.99). Keeping track of FREE MONEY is much easier than
working!! FYI: If you do not sell any stocks in a given
calendar year, there will not be any capital gains or losses
to declare, and no taxes to pay. To avoid penalty, however,
always file your annual tax return on time, even when you
are not reporting capital gains.
Your investment club will be required to file a tax return
annually, which is due on the April 15 deadline. THERE IS
A STIFF PENALTY FOR FILING LATE! The IRS charges $50 per
partner per month for not filing a corporate tax return
by the April 15 deadline. OUCH!
The partnership tax return is filed on Form 1065. Typically,
the profits or losses will be distributed proportionately
among each individual partner, with the appropriate percentage
of taxes to be paid by each partner. Remember to declare
any expenses associated with the investment, including the
cost of hiring an accountant to file the return, broker
What if I don't like my partners? Can we kick someone
out of the club without a lawsuit?
Sample Membership Agreement provided in the iSophia investment
club start-up kit covers what to do when a member wants
to (or has to) leave. Our best advice is that you start
or join a group with people whom you like and respect, and
that everyone is clear on the club rules. Believe it or
not, making money with partners can be a lot of FUN, and
you can use the lessons and information to enhance your
up for Prosperity.
Affirmations are the First step to Improving Your Fiscal
Health… By Chellie Campbell, author of The Wealthy Spirit
an editor is interested in your book!" my agent, Lisa,
exclaimed happily. "I sent her a bunch of proposals,
and she returned all of them to me except for yours! Now
she wants to talk to you."
heart was thumping and my breath came fast. This could be
the break we'd been waiting for. Lisa and I had been working
together to find a publisher for my book, The Wealthy
Spirit, for over a year, through endless rounds of interest,
rejections, almost-deals, and deals that fell through.
likes your book, but has some changes to suggest,"
Lisa went on. "Here's her number. Good luck!"
tried to calm down, and dialed Deb's number. We introduced
ourselves and chatted pleasantly for a few minutes. Then
I asked the fateful question, "What about the book
do you feel needs to be changed?"
first of all," Deb replied, "We've got to take
all the affirmations out of this book."
heart sank like a stone. There was no way I could take the
affirmations out of my book—they are critical in helping
people think more positively about money. I believe that
what we focus on expands, and most people focus on money
in a negative way. The average person has 60,000 thoughts
every day, and most of what they're thinking about money
is depressing: "The rich get richer and the poor get
poorer." "Money is the root of all evil."
"There's never enough money." Daily doses of "I
can't afford it." You have to actively change the way
you think about money in order to have more abundance flow
into your life, and that means repeating positive statements
about money every day in order to replace those old, negative
thinking this deal was never going to happen, I quietly
asked Deb, "Why do you think the affirmations should
be taken out?"
affirmations are old news," she stated flatly. "There
are 97 books on affirmations out there. I can't go to my
forty salespeople and say we're doing another affirmation
book. This has already been done."
you think everyone already knows about affirmations?"
let me ask you a question," I said, "Are you doing
was silence on the phone for a minute. I elaborated, "Positive
statements, out loud to yourself every morning, about money
specifically—are you doing them?"
no, I'm not," she admitted.
my point," I said, "People know about affirmations,
but they're not doing them. Just knowing about them doesn't
do any good. Listen, why don't you test them? I'll give
you my list of favorite affirmations. Say them out loud
while looking at yourself in the mirror every day for the
next 21 days. Then we'll talk again in three weeks."
agreed. Three weeks later, she was on the phone saying excitedly,
"Chellie, this is amazing! I'm getting unexpected money
in the mail. People are paying me back loans I had forgotten
they owed me, and I'm getting bigger and better book deals!"
asked, "So, can the affirmations stay in the book now?"
answered, "Absolutely yes!"
that's why the book was published with the subtitle, "Daily
Affirmations for Financial Stress Reduction".
is the list I gave Deb that day. Why don't you give it the
21-day test yourself and see what happens?
About Wealth & Financial Freedom
love to give me money!
am rich and wonderful.
am now earning a great big income doing what satisfies
wonderful is happening to me today—I can feel it!
my bills are paid up in full and I still have all
affirmations work for me, whether I believe they will
or not. (This is for the skeptics among you.)
lot more money is coming into my life. I deserve it
and will use it for my good and others.
my clients praise me and pay me!
am a money magnet!
comes to me easily and effortlessly, waking and sleeping.
am now highly pleasing to myself in other people's
walk, talk, look, act, think and am rich!
am a winner--I win often, and I win big!
now receive large sums of money, just for being me!
Wishing you peace, prosperity, happiness, and abundance
in all things. You deserve it!
Chellie Campbell is the author of The Wealthy Spirit:
Daily Affirmations for Financial Stress Reduction, selected
as one of Dr. Laura's book recommendations in March, 2003.
She created and teaches the Financial Stress Reduction®
Workshops, on which her book is based, in the Los Angeles
area, and gives programs throughout the country. Her free
e-newsletter is available at www.thewealthyspirit.com.
Investments can Drive a Stock up or Drag it Down.
out the Top 10 institutional picks and pans of the week.
Systems Corp. (WAVX)
Therapeutics, Inc. (RNAI)
Genetics Inc. (CAQ)
Xing Unversal Telephone (XING)
Medical Corporation (SANG)
Technologies, Inc. (WSTL)
» WINsider CALENDAR:
Boot Camp. Wednesday morning chat with financial guru, Chellie
Campbell plus bonus member chat on the HOT BIOTEC SECTOR. A
Great Balls of Fire gala event to protect our nation's men from
one of the most deadly killers on the planet today—prostate
RECAP: (See below for more details on each event.)
Chat with Chellie Campbell. 8.20.03 at 8:45 a.m. PST.
Biotechnology chat session immediately following, at 9:15 a.m.
2. Investors Boot Camp with iSophia founder, N.Wynne Pace, on Thursday, September 18, 2003 in Los Angeles, California. Register at www.learningannex.com or call 310.478.6677. Receive $5.00 off for registering online. For more information on N.W. Pace, call 310.399.0497 or email info@NataliePace.com.
Balls of Fire gala to benefit prostate cancer research. Saturday,
September 6, 2003 @ 6:30 p.m. at the Wilshire Grand, downtown
Los Angeles. Event sponsor: Sirens Society. They will be auctioning off firemen, among other priceless treasures, at this event. Call 323.549.5319 or go to: Tickets@sirenssociety.org.
1. Wednesday Chat with Chellie Campbell. 8.20.03 at 8:45 a.m. PST. Biotechnology chat session immediately following, at 9:15 a.m. PST. Are you stuck in a financial rut? Would you have enough money, if the month only ended on the 20th? Chellie is a master at creating financial success stories and at financial stress reduction. Learn the secrets behind her six principles of success, and why you want to swim with dolphins, while steering clear of sharks AND TUNA.
Biotechnology chat session immediately following Chellie Campbell, Wednesday, 8.20.03, at 9:15 a.m. PST. Once you have the numbers, you still need the word on the street. If you, or someone you know personally and trust their opinion, swears by the product, odds are there are others out there who will benefit and buy. Do you have personal experience with any products of the hot biotechnology and pharmaceutical companies? iSophia wants to hear from you!! Lets network, brainstorm and share our information!
- Go to: NataliePace.com.
- Click on: Chat Room
- Click on: Already a Member (if youre not already a member, its only $4.50 a month to join!! Click JOIN NOW to become a member)
- Enter in your password (Shhh. This months secret password is: user name: 2003, password: August.)
- Enter in your nickname and press return
- In order to participate in the chat, enter in your questions and press return.
Training Camp with iSophia founder, N.Wynne Pace on Thursday,
September 18, 2003.
Lynch and Warren Buffett. Yes, they have investing secrets.
You should know them. At Investors Boot Camp, you will learn
wisdom and success strategies of the most successful stock
Headlines and Hot Tips suck
scam artists and salespersons.
to Buy Low and Sell High.
Companies in a Report Card!
investment style and the Member Mosaic are exciting concepts
that, if used properly, help individual investors better discern
the health of large corporations." Gary Kennedy, entrepreneur,
former president of Oracle USA.
Pace is a successful investor with a trademarked market philosophy.
She beat the market three years running, and has been interviewed
by Diane Sawyer on Good Morning America, in Time magazine, More
magazine and USA Today. Contact info@NataliePace.com
or 310.399.0497. <P>
in the September 18th seminar NOW, call 310.478.6677
or register online and receive $5.00 off. Click here to register
NOW or go to www.learningannex.com.
Click on Los Angeles. Scroll down to August 13th. Click on "Financial
Planning for Women," with N. Wynne Pace and register! (Men
are welcome, too!) If you have any problem registering, please
call 310.399.0497 or email info@NataliePace.com.
information on N.W. Pace, call 310.399.0497 or email info@NataliePace.com.
3. Great Balls of Fire GALA.
The Wilshire Grand, Downtown LA's premier event hotel.
930 Wilshire Boulevard, Los Angeles, CA 90017
Live auction of LA.s finest Firemen, 97.1.s Frank Krammer as our MC, Cirque du Soleil (former) acrobats & Legendaire, Fire eating performers, Live music & Entertainment featuring The Birthday Suits and Sons of Ben, Delicious food & Hot goodie bag & LOTS MORE!!
Tickets, $100 /guest
CONTACT: The Sirens Society, 323.549.5319
or mail check with name and guest info to:
8023 Beverly Blvd #5-455
Los Angeles, CA 90048
For more information on the Great Balls of Fire event, click here. (Adobe Acrobat Required)
4. Wednesdays Worldwide ON-LINE CHAT on September 3, 2003 is with the CEO of the Prostate Cancer Foundation, at 8:45 a.m. PST. One in six men will get prostate cancer! This on-line chat is a MUST for anyone who loves men and wants to keep them healthy, and for investors who are interested in the RED HOT BIOTEC sector! There are lots of DNA-based drugs on the market, many of which are in line for fast-track FDA approval. Go to www.NataliePace.com on Wednesday, September 3, 2003, from 8:40-9:15 a.m. PST. Ask your candid questions of Leslie D. Michelson, the CEO and Vice Chairman of the Prostate Cancer Foundation, who has 25 years in the medical industry. For this important chat, we are opening up our chat room to all interested persons. Use the following passwords:
- User Name: Cancer
- Password: Cure
For more information on The Prostate Cancer Foundation, go to: www.capcure.org
» Companies in the News…
News highlights, as reported by the most respected sources in the world. Alphabetized for easy reference.
October 7, 2003 is the date of the California Recall Election!!
AT&T. With WorldCom barred from new government contracts and Sprint in danger of being blocked from government contracts, due to overcharging the Justice Department to the tune of $2 million, good ole Ma Bell may be the favored company in the Presidential suite. According to Kudlow and Cramer (on 7.31.03), Worldcoms existing billion-dollar government contracts will not be affected by the ruling.
Bennett Environmental, an eco-friendly energy company that cleans up contaminated soil by burning the crap out of it (literally) has been named to Forbes Top Ten Stocks for Summer 2003. Sales doubled in the 2Q to $13.4 million, while earnings increased threefold, from $1.1 million in 1Q to $3 million. There is a slight snag in the fairy tale, however. Certain citizens of New Brunswick, where Bennett is building a new incinerator to keep up with overwhelming demand, arent sure the process is healthy. A public information meeting is being held on August 21 by the Canadian Department of Health and Wellness, and Bennett reps will be on hand to answer the locals questions.
Coach splits in two. The largest seller of luxury leather goods is planning a 2:1 stock split for shareholders on record as of September 17, payable October 1. Shares have risen 58% this year. The split gives Coach 183 million shares outstanding. 4Q earnings were up 73%, and the company has raised their sales and profit forecasts. (Bloomberg News 8.8.03)
Costco has warned that 4Q earnings will fall to as low as 46 cents a share, from 52 cents last year, due to high costs of health care benefits, workers compensation and customer service. So far, the increased operations costs havent resulted in higher prices for consumers. (Bloomberg News 8.6.03)
Gaps earnings more than tripled in July, a time when most retailers saw a rise in sales. Wal-Mart, Target, Gap, Costco, J.C. Penney, TJX, Kohls, Limited, Nordstrom, Neiman Marcus and Saks all reported better than expected sales, up 2-9% from this time last year. Which two companies did not benefit from the buying spree? Sears, Roebuck and Federated Department stores. (Bloomberg News 8.8.03)
Gateway takes a bite off the Apple. Gateway announced that it would begin selling portable digital music players. The 128 megabyte version, in MP3 format, will go for $130, and is available immediately. The 256-megabyte version will be available on August 14 for $170. Get this. The unit is the size of a pack of chewing gum, and connects to computers with a USB port. (AP 8.6.03)
InterActiveCorp (formerly USA Interactive), the Internet titan that owns Hotels.com, Expedia, Match.com, Ticketmaster and the QVC, earned $111.8 million in the last quarter, up from $25.4 million last year, same quarter. Revenue increased 38%, to $1.53 billion. Expedia alone saw a revenue jump of 71%, to $247.5 million from $144.9 million a year ago. (Expedias earnings stomped all over analyst recommendations.) So whats the problem? Too much cash on hand! CEO Barry Diller plans to do something about it quickly, however, and is looking at billion dollar acquisitions, stock buy-backs and/or special dividends. The future looks even brighter for online sales. According to Forrester Research, sales over the Internet will more than double, to $229.9 billion by 2008. Domestic shoppers will spend almost $96 billion on Internet purchases this year. (NYT 8.6.03)
Jet Blue. A year ago, you were lucky to get a bad turkey sandwich on stale bread, if you could grab one from the kiosk before the other desperate Jet Blue passengers, who just realized that they had to bring their own food, snatched up every sandwich in the terminal. Now you have multiple food choices, including sushi, to carry on board. Hows business for Jet Blue? Every flight Ive taken from Long Beach to NYC, and Ive taken almost one per month for a year and a half, has been full. The company is operating in the black, in under less than a year on the market. Can you spell visible expansion and increased market share! (NWP & Money Central.msn 8.12.03)
Johnson & Johnson is under scrutiny in Congress for bundling sales of hospital supplies, and having trouble in the medical community for fatalities that have been reportedly caused by surgeons using the wrong size of stent. Shares are trading near the 52-week low, at $51.00.
Merck is spinning off Medco Health Solutions. Trading for Medco will begin on Friday, August 19th, under the symbol MHS. Why wasnt there a Medco IPO? Lackluster investor interest
Meanwhile Merck is cooperating with the SEC who is investigating their pricing practices. (Bloomberg News 8.6.03)
Opsware. Marc Andreessens new company (founder of Netscape), an iSophia featured company in 2002, has gotten on the radar of institutional investors. Institutional investment shot up to 12.1% on 8.12.03. Money Central rates the stock undervalued, when comparing P/E to growth. With 17.10 P/E and a price of $5.00, Opsware is the leader in a breakout industry of data center automation software. Theyve got a licensing agreement for their products with Electronic Data Systems, the largest IT full-service manager of Fortune 1000 companies. OPSWs 2Q earnings report will be released on 8.21.2003, after markets close. (Money Central.msn.com 8.12.03)
Web-MD shareholders will be voting to increase the number of shares from 300 million to 900 million on 9.12.03. The company is not confirming any acquisition plans, but expert analysts predict WEB-MD is positioning itself for a substantial acquisition. (Bloomberg News 8.8.03)
XM Satellite Radio Holdings (XMSR) reported a deeper hole for 2Q, losing $161.9 million during that period. Costs were mainly related to the cost of bringing in new customers. The ploy worked. Sales were up 4X, to $18.3 million, and XMSR added 209,178 subscribers, for a total of 692,253 subscribers to date. Compared to a cash burn of $161 million per quarter, however, only 700,000 subscribers and their $12 monthly rate seem like chicken feed. Investors didnt seem to care, however. XMSR continues to trade near its 52-week high, with over a billion in market capitalization and 56.6% institutional investor presence. (Bloomberg News 8.8.03)
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