ITW can hardly be considered an Internet company and yet it is. It was started in 1912 (a little bit before the Internet started) and they manufacture engineered products. What is an "engineered product"? Anything from metal fasteners, laminated products, swabs, wipes, and mats for clean room usage in the electronics and pharmaceutical industries; and electronic component packaging trays, dishwashers, refrigerators, etc etc. The list goes on. ITW sells to major manufacturers in every industry and a single customer probably buys 1000s of different items for every part of the manufacturing process. Even though manufacturing, particularly in the auto industry, has had declining growth in 2006, ITV revenues was up 15% YoY in their last quarter's announcement, mostly driven by acquisitions. And what were those acquisitions? The one I want to hone in on is ITW's acquisition in September, 2006 of Click Commerce for $292mm, a price that was significantly lower than Click Commerce's average market cap during the prior year. Click Commerce is a b2b e-commerce provider that sells end to end supply chain management software, collarborative ecommerce solutions, and compliance resolution software to a client list that includes 1400 customers including BAE Systems, Honda, FedEx, etc. In fact, their client list probably overlaps heavily with ITW's client list. And ITW was probably going to have to pay heavily to hire Click's services to manage the extensive supply chain issues that ITW has. Click won't have an immediate effect on $14bb in revenues ITW but the acquisition was accretive with Click only trading at a 14 p/e when the company was acquired. Also, its not just that Click will grow its client list under the ITW hood but that it will streamline every dollar of ITW's $14bb in revenues, increasing margins, building tighter relationships with customers, etc. ITW right now trades for just a forward P/E of 13 and approximately 8 times forward anticipated cash flows. This doesn't factor in at all what I think will be the growth in margins from the Click acquisitions. I think ITW is cheap here and probably an eventual LBO if the management was so inclined.

E-Commerce is the fastest growing part of JC Penney's business. Their store just made it into the top 10 internet retailers with $1bb in revenues. E-commerce sales at the companies are rising 27% YoY and represent 44% of their direct/catalog business. With ecommerce moving from 1% of total retail sales in 2000 to 3.3% of total US retail sales in 2006, and with JCP having one of the fastest growing ecommerce sites, this will become an increasingly more important part of their business over the next five years.

With all the fuss about how horrible the newspaper is doing, the dot-com side of the business is flourishing. About.com comes in at #12 (on the list of most trafficked websites) with 38mm unique visitors Online revenues are expected in 2007 to come in at $350mm, about 10.6% of revenues, up from 8% of revenues in 2006. If About.com was given a Google-like multiple (and maybe it should, since its growing faster than Google), it would be worth more than the whole NYT.

Between Shopzilla.com, uSwitch.com, and Bizrate.com, SSP has 34mm unique internet users a month. Shopzilla has quickly become the largest comparison shopping site since SSP bought it for $525mm in 2005. Interactive revenues have grown from $99mm in 2005 to $271mm in 2006 going from less than 5% of overall revenues to over 10% of overall revenues. With ad sales down in the core newspaper business, the interactive division is the main growth engine at SSP. The company recently announced that they expect earnings from their Interactive group to be in the $60-70mm range for the year. Earnings for the entire company in 2006 was $397mm.

Copart is an intermediary in the salvage vehicle business. Quietly, they have become one of the largest and most profitable retailers on the Internet. If you have a wrecked car (for instance, if you are an insurance company, and you thousands of wrecked cars), you use CPRT to sell to people who break the car apart for parts, scrap metals, etc. Almost all of their business is conducted through online auctions. They had revenues last year of $547mm and EBITDA of 236mm. $319mm cash in the bank and no debt. They trade at a forward P/E of 17.

They just made an offer to buy MAPS. MAPS owns Mapsinfo.com, a leading provider of data for GPS devices.