DoubleClick joined in the ‘Net hangover yesterday, reporting a break-even fourth quarter and gloomy prospects for 2001.
The fourth-quarter pro-forma net income of $216,000, or zero cents per share, was better than the 2 cents a share loss analysts expected, according to First Call/Thomson Financial.
But in after-hours trading, shares in DoubleClick rose $1.50 to a healthy $12.75. Earlier in the day, the stock closed down $1.18, or 9.5 percent, to $11.25. At one point it was at $10.93. The stock’s 52 week low is $8.
Analyst Dana Serman of Lazard Freres said the results were a “nonevent,” thanks to DoubleClick’s mid-December warning. “Whereas Yahoo! has been valued at 15 times revenues, DoubleClick is only at three times revenues, so the market more or less reflects this already.”
DoubleClick Revenues for the full year were $506 million, an increase of 96 percent over 1999.
But the ad-serving and technology company admitted it faces a steep decline in advertising revenues this year. Income from ads will drop 25 to 30 percent this year, it admitted after the bell yesterday. The decline is already in full swing, the company warning of a drop of 30 to 35 percent in the first quarter of this year and a pro forma per share loss of 7 cents to 9 cents – worse than Wall Street’s estimates of a 6 cent per share loss.
DoubleClick’s media revenue for the fourth quarter was $60.4 million, up just 19 percent from a year earlier.
In a conference call with analysts, DoubleClick CEO Kevin Ryan pointed out that income from media, or ad sales, accounts for only 20 percent of the company’s income now, and he was quick to compare the company favorably to rivals such as Engage and 24-7 Media. He added that the company no longer depends on AltaVista for 26 percent of its revenues, as it did last spring, having cut the number down to “2 to 3 percent.”
“I thought they were pretty optimistic for 2001, given that they’ve had to warn for the last two quarters,” said analyst Michael Legg at Jefferies & Company.