Robbie Stephens Conference: Micron on the Mend

The chip company may post its first profit in four quarters. Also, items on Sportsline and Excite.
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SAN FRANCISCO -- Micron Technology (MU) - Get Report may defy analysts' expectations and post a profit in its fiscal second quarter ending Feb. 28. That's the buzz surrounding the semiconductor company at the BancBoston Robertson Stephens Technology '99 Conference.

"According to our models, it looks like Micron might be profitable this quarter," said Edward Hemmelgarn, portfolio manager at

Shaker Investments

, who owns Micron shares and went to the company's presentation Tuesday just to make sure business still looked good. And it did to him.

Hemmelgarn said the breakout meeting was very positive and estimated that Micron can earn as much as 11 or 12 cents per share in the quarter. That would be Micron's first profit in five quarters and well above

First Call's

consensus estimate of a 2-cent loss -- heck, even above BancBoston Robertson Stephens analyst Dan Niles' estimate for breakeven. Niles said at the presentation that Micron is probably his "best idea over the course of the next couple of years." Niles has a price target of 200 for Micron shares by 2001.

Also,

Donaldson Lufkin & Jenrette

upgraded the company Tuesday to buy from market perform with a 12-month price target of 100. The stock was up 4% in Wednesday trading at 73 3/8.

But what are all these bulls seeing in Micron? Simple, said Hemmelgarn. A few factors are falling into place for the company, he said, including most importantly, stabilizing DRAM prices. Micron CEO Steven Appleton told investors that DRAM prices have been relatively flat since September. Thanks to increased production and higher sales volume, Hemmelgarn estimated, Micron's gross margins will increase to 35% to 40% this quarter from 11% last quarter.

This could be some pretty big stuff for Micron. But the best part has yet to come. Analysts and investors say Micron's profits could continue rising for another two years.

-- Medora Lee

SportsLine's Food for Thought

"

SportsLine

(SPLN)

has a solid shot at replacing

Disney

(DIS) - Get Report

unit

ESPN.com

as the No. 1 online sports media company." So said SportsLine bull Keith Benjamin, Internet analyst at BancBoston Robertson Stephens, which has an underwriting relationship with SportsLine.

His enthusiasm caught at least one SportsLine fan off guard. "I was intrigued with what Benjamin said -- writing off Disney like that," remarked Steve Appledorn, portfolio manager at the $850 million

(MNNAX) - Get Report

Munder NetNet fund, which owns shares in the firm. "His comments have got me thinking."

But the real eye-opener for Appledorn was SportsLine's grip on Europe. In the presentation, SportsLine CEO Michael Levy reported 2 million page views a day for the site's cricket coverage alone. Such traffic is missed by popular Web tracker

Media Metrix

, which covers only domestic traffic. "Europe is an area we are watching to find hidden value in these stocks because everybody's trying to build valuation models off numbers that are only domestic," said Appledorn.

The Munder manager said he'll take an even closer look at SportsLine now and compare it with ESPN's overseas penetration with an eye toward possibly adding to the fund's SportsLine position.

-- Alison Moore

Excite Goes Direct

Excite's

(XCIT)

direct-marketing efforts made up less than 10% of the company's fourth-quarter revenue, company CEO George Bell told investors at the Robbie Stephens conference Wednesday morning, but it sees revenue from those efforts growing 600% in the next three years. Revenue from advertising, meanwhile, will grow 300% in that period.

Bell then compared search results for a specific sports team on Excite with those produced at competitor

Yahoo!'s

(YHOO)

site. "Ours is more content, fewer clicks," said Bell. "Theirs is less content, more clicks." He called all of the clicks to get to the desired content "empty calories pages" because users don't land on the pages in between. Rather, they instantly click again to get closer to the results they want. Bell said Excite may have just one-third of Yahoo!'s page views, but "we did 71% of their revenue" in the fourth quarter.

Eric Remer, a banker at

Vrolyk & Co.

, came to Bell's presentation to hear about the company's growth prospects and to get his clients involved in Internet marketing deals with companies like Excite. "They are buying left and right," said Remer. "They've got rich stock to make acquisitions with."

-- Suzanne Galante