We know Jupitermedia posted a loss already so now what?

Jupitermedia (Nasdaq: JUPM) posted a Q1 07 loss of $1 million yesterday, or 3 cents per share, versus a profit of $9.2 million, or 25 cents per share, in the year-ago period. The loss is due to legal fees related to a failed sale of the company to competitor Getty Images (GYI).

When the news hit Wall Street back in February that Getty and Jupitermedia could be merging, shares of JUPM hit $10 a share. Today Jupitermedia shares are down 13% and barely above $6 a share. Despite the bad news reported yesterday JUPM‘s Q1 revenue increased to $34.8 million from $33.9 million in the comparable quarter last year. The Street was expecting revenue of $34.8 million and for the company to break even, thus today’s drop.

Look America, despite your disappointment with Q1 results, this little image company is still growing. Jupitermedia’s CEO Alan M. Meckler said yesterday:
"Our revenues for the first quarter year of 2007 showed improvement over the same quarter of the prior year due to progress made with our Jupiterimages business. Jupitermedia continues to grow as a powerful creator and distributor of a wide range of commercial images and digital content. In addition to the expansion of our image offerings, we increased our wholly-owned royalty-free music offerings during the quarter."

Now that JUPM‘s stock is less than $1 away from its 52-week low, it’s got me interested. If Jupiter can start generating more sales, maybe even start talking with Getty again, what’s to stop their stock from going up a few bucks? Even if the merger never happens, Jupitermedia isn’t dead, so don’t write this stock off.

Frank Lara Jr.

Frank Lara Jr. can be reached at [email protected]; he does not own securities in the companies he covers.