September 1, 2004
SpeculatingStocks.com Stock Pick: Travelzoo, Inc. (TZOO)
Stock Price: $45.00 (long-term strong short)
Travelzoo, Inc. is the Internet's largest publisher of travel offers available directly from hundreds of travel companies. They currently list more than 300 travel advertisers to over 7 million subscribers.
In the most recent quarter the company reported $7.2 million in revenue and net income of over $1.3 million. The net income figure is impressive; however, we believe the stock has become grossly overvalued. TZOO currently has a P/E ratio of over 250.
TASR was not even this overvalued when it hit over $64 a share. Now, TASR has fallen to just under $28. It is only a matter of time before the traders move on to another stock.
SpeculatingStocks.com Target Price: We expect TZOO to fall to around $25 before the end of the year.