Kushner Locke: Web Gumshoe

Kushner-Locke (KLOC) may not be so hot as a maker and distributor of feature films and TV programs. But some pros expect it to make a splash as a Net service provider. The company owns 80% of a Web-based outfit called 1-800-U.S. Search, said to be bound for an initial public offering.

This Web portal provides--through its Web site and toll-free phone services--help in finding people, conducting background checks, and verifying identities to prevent fraud. Kushner has signed a $5 million pact with Lycos, a major Web media company, for its Search unit to provide users of Lycos Network the ability to do searches via the 1800ussearch.com portal.

Kushner-Locke: Web Gumshoe

"What makes Kushner different from its Internet rivals is that its page views average 50,000 a day, yet its stock hasn't reflected its potential," says a New York money manager, who has been buying. The stock has gone from 8 in mid-February to 15. He puts the company's Internet revenues at $800,000 a month, or about $10 million a year. This is higher than at other Net portals, including Zoom.com, which has a market cap of more than $1 billion, and theglobe.com, whose market cap is $583 million--compared with Kushner's $171 million market value. Zoom.com posted 1998 sales of $840,000 and theglobe.com had $5.5 million, vs. Kushner's $75 million.

Big investors expect Kushner will take its Internet business public sometime in the summer. One Internet analyst says that based on the valuation of MarketWatch.com, which posted revenues of $7.03 million in 1998, 1-800 U.S. Search could command a price of 30 a share. MarketWatch.com, whose shares trade at 80, has a market cap of $1 billion.

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