This column was originally published on RealMoney on July 27 at 12:00 p.m. EDT.

I want to say upfront that this is not a column about short recommendations; I'm not a fan of short-selling at all. And I'm very bullish on the Internet stocks over the next several years, particularly growing small- and mid-cap stocks in the sector with cash on the balance sheets, no debt and growing income.

However, there are stocks that I just would not buy here, no matter how fervent the market's pursuit of the Internets. Again, these are

not

short recommendations; what follows are five stocks that I believe are too much of a gamble to risk buying.

iVillage

In 1999, I was visiting my next-door neighbor and he was showing me his latest computer game. "I'm really pissed," he told me in between running around some computer-generated world, picking up random treasures and exchanging them for advanced magical armor. "I put $50,000 into this astrology dot-com company a few years ago, it got bought by

iVillage

(IVIL)

and now it's worth $3 million in IVIL stock but it's all locked up and I can't get out."

Image placeholder title

A familiar story, but one made even more tragic by iVillage's lost potential. It was once the biggest, the best, the site with the most potential at IPO-time. It was

the

portal for women, with a prospective customer audience of 52% of the world's population.

The company's stock hit a high of $130, then a low under $1, before finally settling where it closed Thursday, $5.90. I don't believe the company is going away -- it has $70 million in net cash and generated $5 million in free cash flow over the past year.

But with a market cap of $425 million and only $68 million in revenue, I believe it's had its chance to make it big, and the world, for the moment, has passed it by. Five years of being a brand-name Web site in the space and doing nothing but $5 million in free cash flow is not enough to convince me to pay 180 times earnings. As an aside, my friend (the astrology investor) made back his $3 million and then some by starting up a software company.

CNet

I never figured out the attraction to

CNet

(CNET) - Get Report

. The company started out as a cable TV channel for computer users (huh?) and quickly became a portal for software and Internet news. I believed the site had a chance with Download.com, which was a great site for downloading the latest shareware.

However, with Download.com's recent move into online photo-sharing, I'm not sure I understand the strategy going forward, and I doubt a potential buyer of CNET would, either.

Recently, CNet's share price has spiked to 52-week highs on rumors that it is going to get bought. Perhaps it will get bought, given the recent traditional media company splurge for second-rate Web sites. But a company is going to have to pay at least $2 billion to give shareholders any premium, while paying back the $150 million in debt. And with net income at $9 million, I just wouldn't bet on it.

Mamma.com

I ran into the

Mamma.com

(MAMA)

guys at an Internet World conference a few years ago and asked them what their advantage was over any other Internet search engine. Their reply was that they had very few links on their site, which "made the search engine faster." Whatever.

This site has been around longer than

Google

(GOOG) - Get Report

(the site reads, "copyright 1996-2005") and generated an entire $15 million in revenue over the past 12 months. Somehow, it pulled off a $17 million PIPE financing last June to keep itself alive, but I don't know if any of those investors will make the same mistake twice.

RealNetworks

I own

RealNetworks

(RNWK) - Get Report

stock, by virtue of having been an investor in Listen.com, which was bought by RealNetworks. But I can't recommend it. My one hope in holding it has been that somehow,

Microsoft

(MSFT) - Get Report

will find it in the goodness of its heart to settle RealNetworks' lawsuit.

That said, the software, in my opinion, is worse than Microsoft's, and every time I try to use it, I need to download the latest version of RealNetworks' software -- and it still doesn't seem to work on whatever media file I'm trying to play. I give up.

Google

For most of my prior Internet picks (see "

Nine Easy LBOs" or "

Five Buys for the Internet's New Day"), I like to have a good margin of safety. I look for things like cash in the bank, little debt, increasing cash flows and a single-digit multiple of enterprise value over cash flows. Google has every item but the last.

It's a great company, perhaps the best, and it's here to stay. But if the market starts to experience some volatility in the coming months, I don't see how Google's share price will support itself here.

Please note that due to factors including low market capitalization and/or insufficient public float, we consider iVillage and Mamma.com to be small-cap stocks. You should be aware that such stocks are subject to more risk than stocks of larger companies, including greater volatility, lower liquidity and less publicly available information, and that postings such as this one can have an effect on their stock prices.

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At the time of publication, Altucher and/or his fund was long RealNetworks, although positions may change at any time.

James Altucher is a managing partner at Formula Capital, an alternative asset management firm that runs several quantitative-based hedge funds as well as a fund of hedge funds. He is also the author of

Trade Like a Hedge Fund

and

Trade Like Warren Buffett

. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Altucher appreciates your feedback;

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