Standout stocks: Kaboose Inc. (TSX: KAB)

Moms are a lucrative market. There are more than 20 million with kids under age 12 in the United States alone, making US$1.5 trillion worth of buying decisions each year. So it's no surprise that Kaboose Inc., with its network of parents-and-kids websites targeted at the coveted demographic, is looking like one of North America's biggest Web 2.0 successes. The Toronto-based company, founded in 1999 with the aim of entertaining kids on the web, weathered the dot-com collapse of 2000 before shifting its focus to parents. By the time Kaboose graduated to the TSX in February 2006, three months after entering the TSX Venture Exchange, it was boasting millions of visitors and soaring ad revenue; with 10 million unique visitors monthly, it's now North America's largest independent online media company in the family market, competing with powerhouses like Disney and Nickelodeon.

Kaboose's momentum stems from the company being active in terms of its acquisitions, and choosing them well. Over the past two years, the purchases of e-commerce property Birthday in a Box, scrapbooking community Two Peas in a Bucket, and BabyZone have appealed to its niche demographic. BabyZone, the second-largest pregnancy site in the U.S. and Kaboose's biggest acquisition, came with two million registered users. In January, the company announced the purchase of photo-sharing site, whose technology will likely be integrated across Kaboose's properties, creating social-networking and video-sharing opportunities and attracting more users.

Analysts are reiterating their Buy ratings and raising target prices on the heels of Kaboose's successful Q4 2006 results, expecting its momentum to continue; Ron Shuttleworth of Jennings Capital Inc. has raised his 12-month target a dollar to $3.90. A recent agreement making Target stores the exclusive shopping partner for BabyZone will create additional revenue, and huge potential exists for attracting new markets internationally — 80% of Kaboose users currently reside in the U.S. The company is expected to keep up with acquisitions, and analysts say it is becoming an increasingly valuable acquisition target itself, attractive to international media conglomerates.