Analysts at JP Morgan have released their 2008 investment guide for Internet stocks and say following outperformance in 2007 (Internet HOLDRs (HHH) +14% vs. S&P 500 +5%), they expect more of the same this year. Although revenue growth is seen decelerating to 21.2% from 25.6% last year, the analysts expect EPS growth of 34%, compared to only 8% for the S&P 500.

The analysts' top Internet stock picks for which they have "overweight" ratings include: Google (GOOG), Yahoo! (YHOO), Expedia (EXPE), Omniture (OMTR), Shutterfly (SFLY) and Monster Worldwide (MNST). A doubling of global search revenue to $60B by 2011 (vs. $26.2B in 2007, $30.5B est. for 2008) is projected, as well as a recovery in CPMs after a "muted" 2007.