S&P Capital IQ Equity Research Issues 2013 Internet Predictions

Mon Jan 7, 2013 3:54pm EST

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NEW YORK, Jan. 7, 2013 /PRNewswire/ -- Facebook's disappointing IPO, Apple's new
products and software shortcomings, Yahoo's three new CEOs including  Marissa
Mayer, Google's purchase of Motorola Mobility, and resurgent search competition
in  China, are among the many developments that kept the Internet segment very
interesting in 2012.  Given the nature of the area, it will probably stay in the
news in 2013, and accordingly,  Scott Kessler, Internet equity analyst and head
of the Technology Sector team at S&P Capital IQ Equity Research, has issued 13
Internet predictions for 2013.

On  January 4, 2013, Mr. Kessler issued the following predictions.

1We believe Internet companies will increasingly utilize their balance sheets
for stock buybacks and dividends.  2Reflecting what we see as a decline in
interest and confidence in iOS apps, following disappointment related to Maps
and Siri, we see Apple making substantial commitments to improving its mobile
software offerings. 3As Facebook looks to emphasize mobile and monetization
more, and users become increasingly concerned about privacy issues, we see
greater potential for "Facebook fatigue." 4We think Facebook will expand its
Gifts offering and make e-commerce and perhaps payments more of a priority. 
5With the FTC's inquiry into Google having ended, we believe the company will
become more proactive with acquisitions in terms of size and volume. 6We believe
Google will continue to invest in its enterprise business, with new offerings
and features. 7We think Yahoo CEO Marissa Mayer has made many good decisions but
we believe it will take time for the financials to follow suit.  We think a lot
of the positives are already priced into the stock. 8We don't expect Alibaba
Group to come public or even announce a planned offering in 2013, to the chagrin
of Yahoo investors. 9We see divestitures of non-core businesses, investments,
and products as an important theme, as Internet companies look to focus their
resources and simplify their operating structures. 10Repeating a prediction from
last year, we believe cyber security will become an even more important issue in
2013. 11We think 2013 will be more challenging for online travel companies and
stocks, reflecting more mature businesses and substantial competition. 12We
think CEOs at ValueClick and WebMD appointed in 2012 will help deliver value for
shareholders in 2013. 13We believe that announced planned data center and
network investments will enable EarthLink to become more of a nationally known
and successful technology service provider.

"I've been making these predictions for a number of years and, of course, I get
some right and some wrong," Mr. Kessler said.  "We made a number of accurate
predictions last year, and I encourage folks to read our related research and
reach out to discuss.  We'll see in a year or so how this year's predictions
do."

Facebook (FB 29, Hold)
Apple (AAPL 527, Strong Buy)
Yahoo (YHOO 20, Hold)
Google (GOOG 738, Hold)
ValueClick (VCLK 20, Strong Buy)
WebMD (WBMD 16, Buy)
EarthLink (ELNK 7, Strong Buy)

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