CNET Losing Core Tech Ad Market to Blogs, Social Networking - ThinkEquity

ThinkEquity published an initiation of coverage report on CNET Networks Inc. Monday. A key quote:

Our research suggests that technology advertisers are becoming more efficient in online ad spend and moving dollars away from portals and higher-priced vertical sites toward more cost-efficient, targeted niche technology sites and social networking platforms. In addition, CNET is seeing increased competition from tech-focused blogging and social networking sites... While the online tech ad market has been growing in the 30-40% range for the past several quarters, our analysis suggests that CNET's core tech ad business, which we believe represented 65% of total company revenue last year, is on pace to end 2007 down 3-4%.

ThinkEquity slapped a Source of Funds rating and $7 price target on CNET's stock ($7.70) -- in other words, "sell this stock and use the cash to buy something else."

Commentary: Is CNET Networks Worth a Look? • CNET and TechCrunch: Reality Check • CNET Slides on Downgrade; Bonnie Interested in Selling?
Stocks to watch: CNET. Competitors: YHOO, TWXDJ, NYT, NWS
Earnings call transcript: CNET Networks Q3 2007

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