American Technology analyst Tim Boyd initiated his rating and set a $19 price target for Bidz.com Inc. (BIDZ). Boyd called the company’s interactive auction model “entertaining” and “user friendly,” saying new auctions start every five seconds at $1 each, without reserve prices. Most auctions run for less than an hour — much shorter than the length of eBay auctions, he said. Analysts polled by Thomson Financial expect, on average, earnings of 16 cents per share on $57.8 million in revenue, and Boyd expects the company to meet if not exceed these projections.

Bidz.com, based in California and incorporated in Delaware, is the world’s largest interactive online jewelry auction, and sells products ranging from engagement rings to diamond bracelets, designer watches and sunglasses. Bidz.com also auctions fine art, from original handcrafted paintings to lithograph reprints of classic pieces that are authentically signed and numbered. Auctions last anywhere from thirty minutes up to two days in duration, with the majority of them lasting one hour, and can be bid on by anyone registered with the site.

For the 9 months ended September 30, 2007, Bidz.com had revenues in excess of $123.8 million and net income of $9.9 million in comparison with only $94.1 million and $4.4 million, respectively, for the same period the previous year. Over the next 3-5 years, Bidz.com management expects net revenue to grow annually by 25-30% and pre-tax income margins to reach 10-12%. They also believe the key to their success has been their ability to efficiently and effectively source closeout and regular merchandise, as well as rapidly respond to changing consumer demands for certain jewelry.

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