The Investment Column: 365 well set to ride Web roller-coaster

365 well set to ride Web roller-coaster365 CORPORATION - the provider of sports Internet content and communication services - has had a switchback ride on the stock market since its flotation last month. Unlike other British dot.com stocks such as QXL, Freeserve and Scoot, 365 shares have edged lower after jumping 50 per cent in early post-float trading. Whether this represents a serious buying opportunity or a signal to stay away is likely to vex the most sanguine investor.

It should not go unnoticed by dabblers in online stocks that Mary Meeker, the Morgan Stanley analyst dubbed "Queen of the Net", is predicting a major sell-off of Internet issues early next year. Ms Meeker believes that as many as 90 per cent of listed Net companies are overvalued and due for a correction, although she remains a fan of big cap issues such as Yahoo! and AOL.

But for UK Internet stocks her forecast has no silver lining. Ms Meeker's reasoning suggests that Web stocks here are extremely likely to fall in tandem with their Nasdaq peers, as none of the UK issues have the global scale of, say, AOL to help withstand a correction.

An alternative view is that only some Internet stocks - notably the e- tailers - will crumble once it becomes apparent that Christmas shopping on the Web has bombed. In this scenario, specialist online media companies providing content in niche areas, and trading below their highs, could begin to look cheap.

On this reasoning, 365's tight focus on football, cricket, rugby and some other leisure areas provides just the growth opportunity that could see the company emerge as a powerful new media channel in the years ahead. 365's multi-platform approach - Internet, digital television, mobile handsets - also leaves it well placed to prosper as the switch to digital devices gains pace.

With 365 capitalised at about pounds 450m, there's little room for error. But for investors who want Internet sector exposure, 365 offers an interesting, if speculative, opportunity.