Answers Corporation (ANSW)

Company: Answers Corporation (ANSW)

Current Price: $5.73

Company Website: http://ir.answers.com / www.Answers.com  

The company is Answers Corporation trading on the Nasdaq under symbol- ANSW. ANSW closed today at $5.73.

ANSW owns and operates Web properties dedicated to providing useful answers in thousands of categories - Answers.com and WikiAnswers.com. The award-winning reference site Answers.com includes content on five million topics from over 180 licensed sources from leading publishers, including Houghton Mifflin Company, Barron's and Encyclopedia Britannica. Answers.com is also available for mobile devices at http://mobile.answers.com. WikiAnswers.com is a community-generated Social Knowledge Q&A platform, leveraging wiki-based technologies.

WikiAnswers was ranked by comScore as the fastest growing domain of the top 200, in the U.S. in terms of unique monthly visitors in 2008!

Take a look at this link- http://www.quantcast.com/top-sites-1?r=17#17

Right now, ANSW's Answers.com is ranked the 17th most popular website on the internet! ANSW just recently pushed MapQuest.com to the 18th spot and MapQuest.com sold for $1.1 BILLION! In my opinion, ANSW is extremely undervalued at the current price with a market cap of only $45 Million! This is absurd! In my opinion, I consider this to be a sure thing at these levels!

Think about it... if Mapquest which is now below ANSW sold for $1.1 Billion and Ask.com which is ranked above ANSW sold for $1.85 Billion and ANSW's market cap is only $45mm right now, don't you think this could be an investment opportunity of a lifetime?!

Not only is ANSW's Answers.com ranked #17 behind Ask.com but its WikiAnswers.com is also ranked the fastest growing domain by comScore in 2008! This alone could be worth more than the current market cap of ANSW!

In my opinion, ANSW could also be looked at as a takeover target. Why wouldn't Microsoft, Yahoo!, or Google look into acquiring ANSW?

Look at how fast it is growing and how much traffic it is receiving! Any of these three giants could acquire ANSW at any time to take this rapidly growing traffic for themselves and it would cost them pennies on the dollar! This is only my opinion but I honestly believe this is highly possible! Ask.com and MapQuest and many other websites with the kind of traffic ANSW has are being sold for Billions and ANSW only has a total valuation less then $100 mm!? This is a no brainer!

ANSW just released results for Q4 2008 and they were great! Check this out-

http://finance.yahoo.com/news/Answers-Corporation-Reports-bw-14409663.html

Quarterly revenues rose 30% sequentially to $4.63 million, with Adjusted EBITDA reaching $1.95 million, and our cash balance increasing $2 million to $11.74 million. WikiAnswers.com revenues were $2.8+ mm in Q4 2008, an increase of 309% compared to $704 thousand in Q4 2007 and an increase of 47% compared to $1.960 mm in Q3 2008. Answers.com revenues were $1.7 mm in Q4 2008, a decrease of 24% compared to $2.27 mm in Q4 2007 and an increase of 10% compared to $1.579 mm in Q3 2008. WikiAnswers.com revenues were $7,524 thousand in 2008, an increase of 478% compared to $1,302 thousand in 2007.

All in all, I think ANSW is extremely undervalued right now and could be an investment of a lifetime at the current price.

I am considering taking a position in ANSW in the near future. The chart shows that we may see ANSW head a little lower before making its turnaround but I think anywhere around these levels is a steal. I am considering to start accumaulating at these levels to get the best cost avergae before the major turn around in the stock. Once ANSW bounces it may move very quickly since it lost so much value in such a short amount of time. Good luck and remember I am not a financial advisor and this is solely my opinion. Always do your own due diligence.

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