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  • 5 High-Profit Internet Stocks Projected For Strong Growth 0 comments
    Sep 21, 2012 8:26 AM | about stocks: BCOR, BIDU, BITA, KYAK, RATE

    We all know that putting together a highly profitable internet company is no easy feat. Based upon how many companies have not lived up to expectations, it is understandable that many investors steer clear of internet stocks as a general way to avoid risk. However, there are many companies that have achieved significant growth yet haven't peaked. We thought it would make for an interesting list to look for internet stocks that have a solid track record of profitability based upon their EPS growth rates for the past year. From there we searched specifically for companies that are projected for further growth. We think you will find these profitable internet stocks well worth additional investigation.

    EPS growth (earnings per share growth) illustrates the growth of earnings per share over time. The 1-Year Expected EPS Growth Rate is an annual growth estimate, where the growth projections are made by analysts, the company or other credible sources.

    EPS growth (earnings per share growth) illustrates the growth of earnings per share over time. EPS growth rates help investors identify stocks that are increasing or decreasing in profitability. This profitability metric is generally a key driver in the price of the stock as it directly correlates to the profitability of the company as a whole.

    The Net Margin is a profitability metric that illustrates, by percentage, how much of every dollar earned gets turned into a bottom line profit. This is just one of many profitability metrics used by investors and analysts to better understand what the company is being left with at the end of the day. Generally, a firm that can expand its net profit margins over a period of time will see its stock price rise as well due to the trend of increasing profitability. Net Margin = Net Income/Total Revenue

    We first looked for internet stocks. From here, we then looked for companies with estimated high-growth, with 1-year projected EPS growth above 25%. From here, we then looked for companies that have posted strong earnings growth for shareholders over an extended period of time (1-year fiscal EPS growth rate>10%)(Net Margin [TTM]>10%). We did not screen out any market caps.

    Do you think these stocks should be priced higher? Please use our list to assist with your own analysis.

    1) Bankrate, Inc. (RATE)

    SectorTechnology
    IndustryInternet Information Providers
    Market Cap$1.60B
    Beta-

    RATE stock chart

    Key Metrics

    1-Year Projected Earnings Per Share Growth Rate30.38%
    Earnings Per Share Growth Rate52.37%
    Net Margin10.05%
    Short Interest11.76%

    Bankrate, Inc. publishes, aggregates, and distributes personal finance content on the Internet. The company distributes its content and rate information through its online network consisting of Bankrate.com, its flagship Website that aggregates rate information on approximately 300 financial products, and other personal finance Websites; provides Web services to approximately 75 co-branded partners comprising personal finance sites on the Internet; and licenses editorial content to approximately 100 newspapers on a daily basis. Its products and services include providing information on rates for various types of mortgages, home lending, and refinancing options; original articles that cover topics, such as trends in housing markets and refinancing perspectives; and rate information on various deposit products that comprise money market accounts, savings accounts, and certificates of deposit, as well as online analytic tools to calculate investment value using customized inputs.

    The company also offers insurance quotes for auto, business, home, life, health, and long-term care; advice and detailed descriptions of insurance terms; and articles on topical subjects. In addition, it provides credit card information and comparison capabilities, and allows consumers to search for cards; and information on retirement, taxes, auto, and debt management. Further, the company sells leads to insurance agents, insurance carriers, credit card issuers, and mortgage lenders; hyperlinks on its online network and text links on its rate pages to advertisers on a cost-per-click basis; and display advertisements consisting primarily of leaderboards, banners, badges, islands, posters, and skyscraper advertisements. Additionally, Bankrate, Inc. sells advertising in the Mortgage Guide, CD and Deposit Guide, rate tables, and newsletter subscriptions, as well as licenses research information. The company was founded in 1993 and is headquartered in North Palm Beach, Florida.

    2) Kayak Software Corporation (KYAK)

    SectorTechnology
    IndustryInternet Information Providers
    Market Cap$1.24B
    Beta-

    KYAK stock chart

    Key Metrics

    1-Year Projected Earnings Per Share Growth Rate35.10%
    Earnings Per Share Growth Rate44.95%
    Net Margin14.18%
    Short Interest30.87%

    KAYAK Software Corporation provides online travel search services. The company operates KAYAK branded Websites and mobile applications, including KAYAK.com in the United States; local Websites in 15 other countries; m.KAYAK.com, a mobile Website; and the KAYAK mobile smartphone applications. It also operates swoodoo.com Website and a related mobile travel application under the swoodoo brand in Germany, as well as operates Checkfelix.com, a travel search platform in Austria. The company's travel Websites and mobile applications enable users to search for rates and availability for airline tickets, hotel rooms, rental cars, and other travel-related services across various Websites. It offers leads to travel suppliers and online travel agencies; and facilitates hotel bookings directly through its Websites and mobile applications. KAYAK Software Corporation was founded in 2004 and is headquartered in Norwalk, Connecticut.

    3) Baidu, Inc. (BIDU)

    SectorTechnology
    IndustryInternet Information Providers
    Market Cap$39.11B
    Beta1.79

    BIDU stock chart

    Key Metrics

    1-Year Projected Earnings Per Share Growth Rate34.26%
    Earnings Per Share Growth Rate88.08%
    Net Margin46.45%
    Short Interest2.20%

    Baidu, Inc. provides Internet search services. The company offers a Chinese language search platform on its Website, Baidu.com; and a Japanese language search platform on its Website, Baidu.jp. Its search services enable users to find relevant information online, including Web pages, news, images, documents, and multimedia files through the links provided on its Websites. The company also offers search products and Web directory; search-based community products; mobile search and related products; products and services for Websites and enterprises; e-commerce and entertainment products; and software and related search products. In addition, it provides online marketing and auction-based P4P services that enable its customers to reach users who search for information related to their products or services.

    The company serves online marketing customers consisting of small and medium sized enterprises, large domestic corporations, and Chinese divisions or subsidiaries of multinational corporations primarily operating in the medical, machinery, education, software and online games, tourism and ticketing, transportation, franchising, business services, electronic products, information technology services, financial services, construction and decoration, household appliances, and other industries. It sells its online marketing services directly, as well as through its distribution network. The company was formerly known as Baidu.com, Inc. and changed its name to Baidu, Inc. in December 2008. Baidu, Inc. was founded in 2000 and is headquartered in Beijing, the People's Republic of China.

    4) Bitauto Holdings Limited (BITA)

    SectorTechnology
    IndustryInternet Information Providers
    Market Cap$181.55M
    Beta-

    BITA stock chart

    Key Metrics

    1-Year Projected Earnings Per Share Growth Rate37.50%
    Earnings Per Share Growth Rate102.69%
    Net Margin12.93%
    Short Interest0.09%

    Bitauto Holdings Limited provides Internet content and marketing services for the automotive industry, primarily in the People's Republic of China. It operates in three segments: Bitauto.com Business, Taoche.com Business, and Digital Marketing Solutions. The Bitauto.com Business segment provides subscription services to new automobile dealers that enable them to create their own online showrooms, list pricing and promotional information, place advertisements, and manage inventories on the bitauto.com website, as well as partner websites and search engines. This segment markets its new automobile dealer subscription services under the Easypass brand. It also provides advertising services to dealers and automakers on its bitauto.com website. The Taoche.com Business segment offers listing services to used automobile dealers that enable them to display used automobile inventory information on the taoche.com website and partner websites.

    This segment markets its used automobile listing services under the Transtar brand name. It also provides advertising services to used automobile dealers and automakers with certified pre-owned automobile programs on its taoche.com website. The Digital Marketing Solutions segment offers automakers one-stop digital marketing solutions, including website creation and maintenance, online public relations, online marketing campaigns, and advertising agent services. The company also distributes its dealer customers' automobile pricing and promotional information through its partner websites, including major portals and search engines operated by Tencent, Netease, and Baidu, as well as social networking websites, Renren and Kaixin. Bitauto Holdings Limited was founded in 2000 and is headquartered in Beijing, the People's Republic of China.

    5) Blucora, Inc. (BCOR)

    SectorTechnology
    IndustryInternet Information Providers
    Market Cap$707.98M
    Beta1.28

    BCOR stock chart

    Key Metrics

    1-Year Projected Earnings Per Share Growth Rate56.25%
    Earnings Per Share Growth Rate224.14%
    Net Margin13.57%
    Short Interest2.80%

    Blucora, Inc., together with its subsidiaries, provides white label search and monetization solutions to Web publishers worldwide. The company also operates its own branded search sites, including Dogpile, a metasearch engine, as well as MetaCrawler and WebCrawler. In addition, it offers online tax preparation solutions to consumers and professional preparers. The company was formerly known as InfoSpace, Inc. and changed its name to Blucora, Inc. in June 2012. Blucora, Inc. was founded in 1996 and is headquartered in Bellevue, Washington.

    *Company profiles were sourced from Google Finance and Yahoo Finance. Financial data was sourced from Finviz on 09/19/2012.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Business relationship disclosure: This article was prepared for ZetaKap Media by one of our full-time analysts. We did not receive compensation for this article (other than from Seeking Alpha), and we have no business relationship with any company whose stock is mentioned in this article.

    Themes: quick-picks-lists Stocks: BCOR, BIDU, BITA, KYAK, RATE
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