Bankrate, Inc. (RATE)

NetscribeTech (72.54) Submitted: 1/08/07 7:27 AM : Start Price: $36.50 RATE Score: 0.73

Bankrate, Inc. owns and operates an internet-based consumer-banking marketplace. Being the leading online aggregator of online consumer financial information, the company provides detailed financial information for a myriad of products including wide-ranging loans, certificates of deposits, money market accounts, credit cards and other 300 financial products. As operating through two segments namely online publishing and print publishing segment, the company reviews more than 4,800 financial institutions spread across 50 states.

The online advertising industry has recently experienced accelerating revenue growth, with garnering approximately 30% growth in 2005 and is well on the way to beat the same in coming years. The online channel is becoming ubiquitous in brand advertising and a standard part of most major advertising campaigns. Although the industry is expected to show steady growth, business models and profitability are likely to undergo positive changes over the next few years.

Partnerships with some big names like Yahoo, msn.com, AOL, the Wall Street Journal Online, Bloomberg has given the Bankrate an edge over its competitors. Endorsing the same, its third-quarter revenues rose 57.5% year-over-year. Moreover, its MMIS acquisition also comes handy and enhances the company's presence in print media, the main driver of end users to the company's website. To add to the delight, company’s plan of increasing the graphical advertising rates will translate improved revenues in 2007.

As potential market is enormous, and is still in the early growth stages of consumer awareness of the internet as a personal finance tool, Bankrate with its large presence, is endowed with enough opportunities to nurture. Encashing the same, together with an anticipated increase in site traffic from distribution partners, should instigate positive sentiments for the stock.

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