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Jim Mayer likes to log on to his computer every week or so to see what his fellow investors are saying on Internet message boards about a handful of stocks he follows.

But Mayer, a Kenmore investor, is careful not to take anything that he reads on those message boards as gospel.

"Every once in a while, you'll find someone who gives you an interesting analysis on a stock," Mayer said. "But I would never buy a stock based solely on the analysis I see on a message board."

Sound advice, indeed.

With the stock market booming and the rise of cheap online brokers convincing more and more individuals to try to manage their own investments, the Internet has emerged as a fertile source of investor information.

And the message boards at sites like Yahoo and the Motley Fool have become popular places for investors to talk about individual stocks and whether they're on the verge of becoming the next Microsoft, or, the next Eastern Airlines.

But in the anonymous world of Internet message boards, it's often hard to tell the difference between a thoughtful analysis and an intentionally misleading posting from an unscrupulous investor trying to manipulate the stock's price.

"The first thing to keep in mind is that these are just ordinary people," Mayer said. "They don't know any more than you do about the company. They may also have a hidden agenda."

But sometimes, you can find a nugget of good information on the message boards. For instance, a posting June 3 on Yahoo's M&T message board from someone claiming to be the husband of a Chase Manhattan Bank worker noted rumors that M&T would buy Chase's upstate operations.

Sure enough, M&T announced that it was buying Chase's branches in the Binghamton, Corning, Buffalo, Jamestown and Albany areas a little more than a day later, although Chase kept its branches in Syracuse and Rochester. Although the "rumor" didn't have all the details right, the message board posting was pretty close to the mark.

And there's no denying that Internet message boards can be a powerful force in moving the price of some stocks, especially the shares of small companies that trade in very small volumes.

A pair of Buffalo-based companies, Rand Capital Corp. and Barrister Information Systems Corp., both saw their shares more than double in a matter of days this spring after investors touted the stocks on their Yahoo message boards. The stocks have since fallen back to roughly the prices they traded at before the message board activity heated up.

In Rand's case, one investor spread false rumors that investment banking giant Goldman Sachs was about to recommend the tiny Buffalo venture capital firm's stock. Another mistakenlycharacterized Rand as an Internet stock, possibly in an attempt to cash in on the frenzy that was driving Web stocks to dizzying heights.

"I think there is some room for abuse and people need to understand what they're doing," said Pete Grum, Rand's president, who occasionally responds to postings on Rand's Yahoo message board. "But it's not a substitute for hard work."

With Barrister, the stock has been targeted by a group of investors who call themselves Ted Heads or Investolators and are disciples of Oregon-based stock promoter Ken Roberts, who promises investors that they can make millions of dollars with "10 minutes of fun a day."

Henry P. Semmelhack, Barrister's president, said he isn't sure how much of the stock's May surge and subsequent retreat was due to the message board activity or its new new Internet-based customer-service management system and its January purchase of a Silicon Valley software development company.

"I've never ever gotten a call from someone who says they're a follower of Ken Roberts or who said they saw something on an Internet message board," said Mark Donadio, the Barrister vice president who does most of the company's investor relations work.

But there's no denying that Barrister's sleepy stock, which traded an average of roughly 10,000 shares a day in April, now has more than three times that volume on a typical day.

Regardless, Semmelhack said he's not impressed with the message boards.

"I see no thoughtful analysis or thoughtful review," he said. "I'm struck by how they range from gossip to the promotion of ideas," he said.

"It's the wild West," said Anthony J. Ogorek, who runs Ogorek Capital Management in Williamsville. "I think they're good as a source of ideas, but I think they're definitely suspect as a source of analysis."

Make this the first rule of scanning Internet message boards for stock tips: Don't accept any information you see on a message board as fact unless you can verify it independently.

"It's very hard to gauge the information that you're getting," said Peter Aleksandrowicz, a Hamburg financial planner. "They'll swear they have the inside track, but none of the information is independently verifiable, so you have to take it with a grain of salt."

Rule No. 2 is to never buy a stock based solely on what you read on Internet message boards.

The main problem with using message boards as a source of information and analysis is that you don't know who's posting the messages. It could be an embittered ex-employee. It could be an investor trying to drive up the stock's price, or a short-seller trying to convince investors to sell. Or it could be just an average investor sharing his or her thoughts on a particular stock to see if others agree or disagree with the analysis.

"It's a good place to spread rumors," Aleksandrowicz said. "You get a lot of people bad-mouthing stocks too."

Instead, use the message boards as a way to get a feel for investor sentiment and interest in a particular stock, the local experts said.

"The value in it is if someone makes a remark about something that you haven't thought of and you can research it further," Ogorek said.

Some local brokers, like Sally D. Abell of Advest Inc. and Peter O'Keefe of O'Keefe & Shaw & Co., said they don't bother with message boards at all, relying instead on the more traditional financial information available in company reports and other sources, along with the opinions of analysts who follow a firm.

Still, there's no denying that message boards are a new force in the investment world, especially with small company stocks that don't trade much. It doesn't take much buying activity to send the price of a lightly-traded stock soaring.

"The smaller the float of a stock, the greater the chance of it being manipulated on a message board," Ogorek said.

Rand's Grum said it seems that many of the people who post messages prefer to remain anonymous. Although Grum occasionally has responded to postings on Rand's Yahoo message board by suggesting that someone give him a call, he said no one ever has.

"We're a small company without formal investor relations. We do use it as a form of shareholder communication," he said.

"It's part of life now," Grum said. "I read it and pay attention to what's going on there. I think you almost have to."

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