Not all dot-coms have flamed out. XCare.net (XCAR ), like many other online enterprises, traded at much higher levels last year, peaking at 30 a share after being taken public by Robertson Stephens at 18 on Feb. 2, 2000. It tumbled to as low as 5 by mid-March of 2001 but since then has more than doubled, closing at 12 on Aug. 8. This leading provider of customized Web portals and e-commerce services mainly to health-care companies is expected to be in the black in the fourth quarter--thanks to surging revenues. Or so says Anthony Vendetti, senior health-care analyst at Gruntal.
Vendetti sees the stock hitting 22 over the next six months. And in the next 12 to 18 months, he predicts a leap to 27. Part of the good news: Vendetti reckons that XCare will post earnings of 50 cents a share in 2002 and 85 cents in 2003, vs. a projected loss of 27 cents a share in 2001. XCare is well positioned, he says, to benefit from the increasing demand for health-information-technology services, such as infrastructure for Web-based processing of bills and payments.
The big earnings push at XCare is partly due to its five-year pact with MedUnite, a consortium of seven major health-care insurers, including Aetna, CIGNA, and Oxford. XCare has set up a MedUnite Internet-based system to handle various transaction processing between payers and health-care providers. Vendetti estimates that MedUnite will contribute 40% of XCare's revenues in 2001 and 34% in 2002.
XCare is actively seeking to form strategic alliances with major software-technology, biotech, and media-entertainment companies to widen its reach.
By Gene G. Marcial