Marchex shares fall; Stanford Group downgrades to sell, maintains $10 target

BOSTON, Jul 01, 2008 (Thomson Financial via COMTEX) -- MCHX | Quote | Chart | News | PowerRating -- Shares of Marchex Inc. tumbled Monday after the Seattle-based online advertising company was cut to sell from hold at Stanford Group on concerns about expected second half 2008 improvements, cash flow sustainability and premium valuation.

The stock sank 9.9% to $12.25 on volume of 468,000 shares, above the issue's 30-day average volume of 284,000. Prior to the opening bell, Marchex shares had climbed nearly 26% year-to-date.

"Marchex's operating history does not inspire confidence with largely disappointing results over the past two years," Stanford said. "The slow growth economy and third quarter seasonal softness contribute to our bearish view."

Stanford also said the recurrence of Marchex's organic revenue is unproven and that it is concerned about the company's ability to return cash flow growth and match guidance in the second half of 2008.

The firm maintained its price target of $10 a share. Greg Saulnier gs/jw

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