Jefferies: Internet Stocks Have Monster September

Internet stocks rose by a whopping 22% during 3Q10 vs. S&P500, which was up 11%. During the month of September, the group was up 15%. Improving consumer confidence and receding fears of a double dip have lifted valuations but also raised investors'expectations,likely leading to increased volatility short-term. Amazon AMZN and Google GOOG saw robust 3Q growth YoY. Ebay EBAY continues to lag the market. 4Q outlook is looking good for both ecommerce and online advertising. Mercent expects e-commerce to be up 15-17% Y/Yin 4Q. The group continues to show robust growth as a whole. Jefferies has a Buy on Amazon PT $140, Ebay PT $30, and Google PT $680. GOOG closed Friday at $536.35 AMZN closed Friday at $155.55 EBAY closed Friday at $24.61