Interactive TV stocks continued their 2001 upswing Tuesday amid a flurry of press releases and an analyst report that was bullish on the sector though more conservative than previous research.
On Tuesday, interactive TV technology firm
jumped 12.5% to $8.44, personal video recorder developer
rose 11% to $9.13 and electronic program guide developer
Gemstar-TV Guide International
added 8.8% to $51.13. Posting smaller gains were interactive TV companies
and video-on-demand player
For 2001 through Tuesday morning, a basket of interactive TV stocks tracked by
media and interactive TV analyst Spencer Wang was up 40%, though the same group fell 81% in 2000.
The ongoing price changes indicate the difficulty investors face in valuing interactive TV stocks, which reap minimal revenues for the most part but hold great promise for investors who believe that television will take on more of the participatory character of the Internet.
Part of the gains appear sparked by press releases from the the
NATPE television industry convention in Las Vegas, where firms including Liberate and
talked up different products and services. In addition, companies including programmer
made presentations to investors Tuesday at a
C.E. Unterberg Towbin
conference covering interactive TV.
In a report issued Tuesday morning, Wang cut price targets on six different interactive TV stocks he follows, cutting ACTV's from $25 to $12, Liberty Digital's from $45 to $20, and Gemstar's from $100 to $70. Wang rates all of these companies a strong buy, and his firm hasn't done underwriting for any.
Wang says his new price targets take into account more conservative assumptions about the risks investors perceive in holding ITV stocks and their appraisal of the companies' expected value several years from now. These changed assumptions, he says, primarily reflect changing stock market conditions.
What the changed assumptions don't reflect, he says, is any diminished enthusiasm for the sector. "We still remain remarkably excited about the opportunity for interactive television," Wang says.