Dear Mr. Berko:  I have $20,000 with which to speculate. I’d like to own three or four Internet stocks that have good profit potential and are trading way down from their highs of four years ago.  Can you recommend some companies with the potential (and I know I’m taking a risk) to move up between 40 percent and 50 percent in the coming 12 months?   P.B., Fort Walton Beach, Fla.

Dear P.B.:  According to a survey conducted last quarter by Business Week, 141 of the 238 Web companies (that’s 60 percent) made a profit in the last quarter of 2003, almost a 50 percent improvement from a year ago.

This advance resulted from a 40 percent growth in online advertising and a 25 percent jump in e-shopping. Wall Street expects those numbers to improve by 20 percent to 25 percent in the coming 12 months. If you can handle highly volatile stocks and can afford to place $20,000 at significant risk, consider the following four issues.

SINA Corp. (SINA-$36.40) owns a branded network of Web sites in China, provides an array of services that include online portals, e-mail, wireless short messages, virtual Internet service, e-commerce, e-learning, enterprise e-solutions and online games.

Since 2000, when SINA traded at $58, revenues have grown from $14 million and increased each year to $114 million last year. SINA made its first profit of 58 cents a share last year and in 2004 revenues could grow to $210 million, increasing profits to $1.20 a share. Next year the experts on the Street think that SINA could earn $1.60 a share.

I think SINA is a great speculation for people with iron hearts. The company has zero debt, just 48 million shares out and a huge glut of cash. Talk is that SINA could rise to $60 in 12 months.

CheckFree Corp. (CKFR-$30.86) traded at more than $125 a share in 2000 when revenues were $310 million and the company lost 61 cents a share. It’s been downhill ever since. Revenues continued to prosper every year ($552 million last year) but the stock crashed to $19 in 2003 when CKFR lost 56 cents.

CKFR operates in three business segments: electronic commerce, software and investment services. After years of continued losses, the Street projects earnings this year of 98 cents and $1.22 for 2005. CKFR has almost zero debt, plenty of cash, 90 million shares out and is followed by 25 analysts, some of whom think the shares could reach the mid-$40s in the coming 12 months.

DoubleClick Inc. (DCLK-$8.37) provides products and services to help Web companies optimize their marketing programs online. DCLK traded at the $135 level in 2000 when revenues were $505 million and losses were $1.30 a share. Since then, revenues declined each year to $271 million in 2003, but, wonder of wonders, DCLK booked a profit last year of 12 cents a share. Meanwhile, profits are expected to reach 31 cents in 2004 and top 50 cents a share in 2005.  The company has very little debt, huge bundles of cash and 137 million shares outstanding. The analysts predict that DCLK could trade in the high teens within the coming 12 to 18 months.

United Online Inc. (UNTD-$17.82) provides Internet access services via the NetZero, Juno and Bluelight Internet brands in 6,500 cities across the United States and Canada. UNTD has 5.2 million subscribers and active users.

Since 2000, revenues have grown each year from $55 million to $339 million last year and management expects 2004 revenues to top the $385 million mark. In 2003, UNTD enjoyed its first profitable year, earning 80 cents a share. Analysts expect 2004 earnings to hit $1 and earnings for 2005 to reach $1.29.

The company has zero debt, a substantial cash position and 64 million shares out. Some observers think that UNTD, which traded at more than $120 a share in 2000, could trade between $21 and $23 in the coming 12 months.

I doubt that any of these four issues will come close to their high prices of 2000, but each of them could produce gains between 40 percent and 50 percent in the coming 12 months (providing we don’t have another market meltdown). But recognize that though many analysts believe these issues have a potential 50 percent move in the next 12 months, that move could be on the downside, too.

Please address your financial questions to Malcolm Berko, P.O. Box 1416, Boca Raton, Fla. 33429 or e-mail him at malber@adelphia.net.