Organogenesis, Lycos, Level One and barnesandnoble.com

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A selection of some of the most intriguing tech stock ideas on the Web. The items presented do not represent the views of TheStreet.com; rather, the collection is offered as a service to our members who may be scanning the Web for stock-related information.

Organogenesis

George Stasen

(Aug. 24)

Artificial skin is more than a Star Trek fantasy. It's a component of an underserved worldwide chronic-skin-wound market estimated at more than $6 billion annually, according to biotech stock analyst George Stasen. The market, which includes such ailments as diabetic foot ulcers, venous stasis ulcers and bedsores, continues to grow with our aging population.

A good play on this market is

Organogenesis

(ORG) - Get Report

, says Stasen. The company has received clearance from the

Food and Drug Administration

to market an artificial skin product called

Apligraf

. This product treats venous stasis ulcers, which typically strike the inactive elderly just above the ankle, causing open leg wounds that are difficult to heal. The current 100-year-old treatment protocol calls for the use of compression bandages. "What better definition for an under-served market?" asks Stasen. Pharmaceutical giant

Novartis
AG

is Organogenesis' marketing and distribution partner for the product.

Stasen finds it ironic that Organogenesis shares have declined 50% to 13 since FDA approval. But he takes heart from findings in a recent study by

Frost & Sullivan

that says skin-substitute markets experienced an 85% revenue increase in 1997 and should continue to show explosive growth.

More information can be found at:

www.talks.com

Lycos

Forbes.com

(Aug. 26)

Lycos

(LCOS)

is the fourth most-visited destination on the Web, yet it's overshadowed by its search-engine rivals

Yahoo!

(YHOO)

and

Excite

(XCIT)

. Lycos stock was up 50% this year to 60 before splitting 2-for-1 Tuesday, but by Web standards that's pitiful. Excite is up 150% and Yahoo is up 180%. But Lycos has made some smart acquisitions, says

Forbes.com

, and shows promising signs of breaking into the black.

Among Lycos' purchases have been online community host

Tripod

, E-commerce vendor

WiseWire

, software maker

GuestWorld

and Email and directory service

WhoWhere?

. In general, analysts say Lycos paid bargain prices. With the acquisitions, Lycos had an unduplicated reach of 31% of home users in July, up from 24.7% in June, according to

Media Metrix

.

Internet analyst Abhishek Gami of

William Blair

likes Lycos' acquisition strategy, telling

Forbes.com

that it will keep revenues growing. And, in fact, revenues were $56.1 million for the fiscal year ended July 31, up 152% from the previous year's revenues of $22.3 million. "And one day," Gami says, "Lycos will get that critical mass where they start making money."

More information can be found at:

www.forbes.com

Level One Communications

Michael Murphy

(Aug. 25)

Level One Communications

(LEVL) - Get Report

makes semiconductors for such communications industry clients as

Lucent

(LU)

,

3Com

(COMS)

and

Hewlett-Packard

(HWP)

. The company's financial performance has been "impeccable," according to Michael Murphy of

The California Technology Stock Letter

. Revenues grew 56.6% annually for five years through 1997 and were up 87% for the first half of this year. Yet the stock has been beaten down along with other chip stocks. It trades at 20, well below its 52-week high of 33 1/4.

Level One's core markets should grow from $5 billion in 1997 to $11 billion in 2001, says Murphy. The recent acquisition of

Acclaim Communications

extends its reach into multilayer switching and routing silicon technology, markets that should grow from $16 billion to $26 billion during the next four years. In addition, Murphy lauds Level One's close relationship to its customers. The company doesn't invest in a new design until it has a customer committed to buy it.

Murphy recommends buying Level One up to 24 and set a target at 32.

More information can be found at:

www.tfc.com

barnesandnoble.com

Haywood Kelly

(8/21)

Barnes & Noble

(BKS) - Get Report

announced that it may offer 20% of its online arm,

barnesandnoble.com

, to investors if market conditions permit. Not a bad idea, considering the astronomical valuation for the No. 1 online bookseller

Amazon.com

(AMZN) - Get Report

, which has seen its stock has soar 700% in the past year and its market cap balloon to $6 billion. For barnesandnoble.com, "a valuation even half as high wouldn't be too shabby," says Haywood Kelly of

Morningstar StockInvestor

.

But, he notes, Amazon.com has a big head start, and it shows in the second-quarter numbers for both companies. Amazon.com's sales were $116 million versus $12.5 million for barnesandnoble.com, and it lost only $17 million during the quarter versus $23 million for barnesandnoble.com. For both companies, the foreseeable future is one of massive spending to buy market share with no profits in sight. Meanwhile, Barnes & Noble, the parent, has lost money in three of the past five years.

While an IPO will raise money for the online business, Kelly reminds us that it also allows Barnes & Noble shareholders to "cash out." Indeed, they may be the biggest winners. "They'll have succeeded in dumping 20% of the online business into someone else's lap," he says.

More information can be found at:

www.morningstar.net

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.