CNET también está disponible en español. Don't show this again. Despite facing myriad challenges, many analysts bet that Infoseek chiefexecutive Harry Motro can win shareholder support for thedeal, which will be put to a vote on November 18. As reported, Disney will take a 43 percent stake in Infoseek, while handing over its ownership of Starwave. The companies are teaming up to launch the Go Network later this year, the "mother of allportal sites," as one industry executive put it. Infoseek yesterday posted weaker-than-expected third quarter earnings, causing its stock to drop as much as 5.1875 points this morning. At least three investment banks downgraded the stock following the earnings report.
Andrea Williams, an nature walks (light background) iphone case analyst with Volpe Brown Whelan noted that Infoseek's stock, while down today, has made a strong recovery since earlier this month, The stock closed at 18.50 on Oct, 8, but has since climbed into the 30s, "The reason it's had this run is because of increased optimism for thepotential of the Disney deal," Williams said, "In the past few weeks, therehas been more details about the Go Network and Disney's role with Infoseek.", Bruce Smith, an analyst with Jeffries &Co., said investors who sold today likely are those who thoughtInfoseek would blow past earnings expectations..
"They should invest in this stock for what Disney brings, not for thenear term. I think they'll blow away the numbers in the second half of1999," Smith said. Yet Keith Benjamin, an analyst with BancBoston Robertson Stephens, said in aprevious interview that Infoseek is jumping into the portal business a little late in the game. Infoseek's slow audience growth rate over the past quarter, combined with Disney's inexperience in growing Web sites, will hamper Go's development, Benjamin said. Go Network is scheduled to launch in March 1999.
The October rise in Infoseek's stock price puts it back to the level whereit roughly traded when the deal was first announced, Analysts with Salomon SmithBarney, CIBC Oppenheimer, and Deutsche Bank Securities lowered theirrecommendations the stock to nature walks (light background) iphone case "hold" from "buy" today, "The stock has had a good run and the company has a lot of potential, butat this level [of trading], I want to see the deal really workingbefore I put more money into it," said Henry Blodget, a CIBC analyst, Lanny Baker, a Salomon Smith Barney analyst, said in a research report hewas lowering his recommendation because the "upside timing" of the Gonetwork appears to be pushed further back..
"The partnership with Disney, the acquisition of ESPN.com/ABCNews.Com andthe Go.com portal project have potential to significantly enhance[Infoseek's] long term value, however integration issues and brandinvestment plans point to deeper losses in 1999 than we had anticipated,"Baker said in his report. Infoseek pushes for shareholder approval for its deal with Disney, just after posting weaker-than expected third quarter earnings. A financial "D-day" looms for Infoseek. The Internet directory is lobbying to win shareholder approval for itspending investment by Walt Disney justafter the company posted weaker-than-expected third quarter earnings andhas lost some investor support on Wall Street.
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