Just a quick update on Marchex, a stock I first posted about on a year ago (see "Marchex Inc. Intro" posted 12/26/04). Anyway, as shown in this chart, this domain name and traffic monetization company has had a good run the past couple of months, and now Cramer-Come-Lately, James Cramer, has joined the bandwagon, which may explain the gap up and volume surge. Seems to me like a good place to form a handle on a nice one-year base. See the rest of this post for a view of the 1-year weekly chart and Cramer’s gushing endorsement. Cheers!
Now that is a nice base, complete with some quiet and tight trading along the bottom and increasing volume on the right side. Breakout would be solid move on volume above $26. You’ll know it if/when it happens.
Ok, here’s Cramer’s fluffer, from his website, www.thestreet.com:
Marching Toward Marchex
Cramer is bullish on Marchex (MCHX:Nasdaq – commentary – research – Cramer’s Take) as a play on local Internet search. Marchex helps draw traffic to local businesses’ Web sites by helping their ads appear at the top of search results. It also owns Web properties, including 98% of all U.S. zip codes with a dot-com or dot-net suffix.
Cramer is also a fan of Marchex’s CEO, Russell Horowitz, who Cramer said is one of the early pioneers of the Internet.
Marchex’ stock is expensive, trading at 10 times sales. But Cramer noted that TheStreet.com Internet Review author James Altucher believes Marchex could have triple-digit earnings growth in the next several years.
Cramer has been waiting for a decline in Marchex to recommend the stock, but said that "isn’t happening." He would buy half a position now and purchase more later if the stock does pull back.
Marchex "may very well be in the class of Google," Cramer said.