Stock Market

NBCi presents

August 3, 1999

Steve Harmon, CEO of e-harmon.com, shares his views of the stock market and the potential of internet stocks.

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CNBC: Welcome to CNBC.com's MoneyTalk Live! Our guest today is e-harmon.com CEO and Internet Analyst Steve Harmon, a frequent commentator on the web and guest on CNBC. Harmon created the ISDEX, Internet Stock Index, and was Senior Investment Analyst for Jupiter Communications in 1995-96. In December 1995 he authored a comprehensive databook that forecasted five years of Internet growth in such areas as e-commerce, e-music, broadband cable, Internet, content, software and hardware among others. Before Jupiter, Steve was with Paul Kagan Associates.

Steve Harmon: Let's get ready to rumble!

Cosmos: What is your opinion of digital island, backweb and cybersource?

Steve Harmon: Of the three, I think Backweb has the most potential. Both as a stock and as a company. They haven't had the recognition that Digital Island has had. However, I think all three do have potential to grow in the infrastructure space.

Eliteman: Please Comment on Business to Business Commerce on the internet.

Steve Harmon: I think this market will be easily five to ten times larger than the consumer market. There is tremendous opportunity for investing in this area. However, it is still too early to know which companies will be the winners. Early bets are CommerceOne, the aforementioned Digital Island, and Backweb is another one. Infospace, PSI Net, there are literally dozens of stocks across the commerce and content spectrum.

Howard: Steve ,how do you think selling clothing on the internet will do, and in particular what do you think of BLUEFLY's (bfly) potential?

Steve Harmon: Well an interesting statistic is that apparel is one of the top-selling items on AOL, which is surprising. Companies like Delias and Bluefly are the early pure plays selling mostly to teenagers. As stocks, I think the short-term upside exists, but long-term I have a big question mark.

Marlee: Steve, who do you think is the best on-line broker company to go with?

Steve Harmon: Well, the strategies that, well the best are the ones that can execute your trade when you want. None are 100 percent reliable. With that said, I can't favor one over another. Most investors have two or three. They have a portion of their brokerage account with one, and a portion with another, just in case one gets overloaded. That would be my favorite strategy. Of the two or three, there is Datek, ETrade and Schwab.

Longterm: Steve - I'm 29 year old male that invests aggressively long-term. Are these merely short-term dips that are good times to buy AOL and CMGI type stocks - or is there more to the picture? Thank you.

Steve Harmon: I am a fan of buying market leaders on dips. Especially AOL. I have been slapped in the face for being a fan of AOL, but as I pick apart their business, I just see a lot of girth, revenue users, page views. CMGI, I still think they have a lot more left on them. Whether that fits your investment criteria, that is up to you.

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