assumed leadership at the end of April and subsequently gained some momentum after the release of better-than-expected employment statistics for April reported on May 6.
At the time, this indicated to me that any economic soft patch ended in April, and as we embark on second-quarter earnings, there are positive stories to tell among the networking and Internet companies, which report next week.
Networking companies need to retool given strong demand for broadband and other Internet protocol updates. This is directly related to increased use of the Internet search engines, portals and Internet service providers, which are converging as platform capacities expand.
reports its earnings Tuesday, as does
. Wednesday brings Internet auction house
and the search leader,
Juniper Networks is expected to report 17 cents per share when it reports next Tuesday. My current model shows the stock 52.5% undervalued, which puts fair value at $55.09. I do not project the stock to be that high this quarter, but shares could move the stock toward my quarterly risky level at $33.37.
As a sign of long-term strength, the five-week modified moving average (MMA) has been above the 200-week simple moving average (SMA) since Aug. 15, 2004. A close next week above its five-week MMA at $25.21 should provide the catalyst for a trend toward $33.37, where profits should be taken.
The July 12 Nielsen/NetRatings report showed that advertisers spent $456 million on online ads in June. The survey does not show how much money was spent at each Internet site, but as I profile each company below I will give you a sense of the viewership demographics.
Yahoo! is expected to report 13 cents per share next Tuesday. The stock is 28.5% undervalued, which makes fair value $51.37. The weekly chart profile is neutral, and with shares trading above its five-week modified moving average at $35.72. The five-week MMA has been above the 200-week SMA since Dec. 19, 2003. The key levels to penetrate and hold on a positive reaction to earnings are quarterly and monthly resistances at $37.28 and $38.19.
The Yahoo! brand ranks No. 1 in views with 99.137 million unique views in June with an average of just over 3 hours, 6 minutes time online per person during the month. This is a solid demographic to maintain or expand online advertising dollars.
eBay is expected to report 18 cents per share next Wednesday. The stock is 35.1% undervalued for a fair value at $53.85. The weekly chart profile is negative, so eBay should stay below its fair value for a long time. A positive is the fact that the five-week MMA has been above its 200-week SMA since Nov. 22, 2002. A close next week above its five-week MMA at $35.27 would be a positive.
The eBay brand ranks No. 6 in views with 51.098 million unique views in June with an average of 1 hour, 58 minutes time online per person during the month.
Google is expected to report earnings of $1.19 per share next Thursday. Google is 11.6% overvalued for a fair value at $267.84, which I consider major support on weakness. The weekly chart profile is positive, with an 89.0 reading for its 12x3 weekly slow stochastic, which is overbought on a scale of 00.0 to 100.0. The five-week modified moving average provides a higher support at $278.30.
The Google brand ranks No. 4 in views with 76.931 million unique views in June with an average of 40 minutes time online per person during the month.