Shares of CDNow (Nasdaq: CDNW) continued their dramatic climb on Monday, gaining 2-3/8 to 21-3/4 on a day that many Internet stocks were sold off dramatically. And this comes just one trading session after CDNow stock soared 3-7/16 to 19-3/8.
Volume on Monday was heavy, with more than six million shares changing hands, about 1.5 million more than Friday’s volume and more than eight times the average daily volume. It’s obvious that many think CDNow is a takeover target, with Time Warner and BMG mentioned as possible buyers.
There’s an interesting wrinkle to this story. Another reason that Amazon.com may be falling is the speculation surrounding CDNow. If CDNow gets bought out be a company like Time Warner and BMG and then expands, it could be another formidable competitor for Amazon.com.