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Internet IPOs Up 11% As Group In Week

Internet stock initial public offerings continue to fill Wall Street's new issue pipeline even after the recent correction the entire sector took on interest rate fears. While I don't think the IPO market is as hot as it was in first quarter this year the latest week shows a 11% climb.

I attribute the factor to investors who sold off Internet stocks and sent them plunging 50% from the tops who now are moving back into the sector albeit a little more cautiously.

Ariba (NASDAQ:ARBA) launches itself on a 291% run from IPO price June 23, ending the day at $90 per share in one of the hottest debuts in quite some time. It sells 5 million shares at $23. While I like Ariba's ecommerce software focus much larger rival Oracle (NASDAQ:ORCL) leads the market by far.

Another strong IPO June 23 was GlobeSpan (NASDAQ:GSPN) a maker of chips that speed up data transmission over regular phone lines by as much as 100x.

Let's see how the existing Internet IPOs have done since June 17, as an indicator of Wall Street's bandwidth:

Company Stock 17-Jun 23-Jun Percent
name Symbol close close change
StarMedia STRM $ 40.00 $ 49.88 25%
Vignette VIGN $ 47.13 $ 58.75 25%
Priceline.com PCLN $ 88.94 $ 110.88 25%
About.com BOUT $ 38.63 $ 46.75 21%
Verticalnet VERT $ 71.00 $ 82.13 16%
Allaire ALLR $ 50.50 $ 57.50 14%
BackWeb BWEB $ 17.75 $ 20.06 13%
OneMain ONEM $ 17.75 $ 19.75 11%
WebTrends WEBT $ 33.13 $ 36.19 9%
Pacific Internet PCNTF $ 42.88 $ 46.75 9%
Marimba MRBA $ 37.00 $ 38.38 4%
Prodigy PRGY $ 22.94 $ 23.25 1%
Healtheon HLTH $ 87.88 $ 88.25 0%
Autoweb AWEB $ 12.50 $ 12.38 -1%
iVillage IVIL $ 44.00 $ 42.75 -3%
MarketWatch MKTW $ 51.00 $ 49.00 -4%
drkoop.com KOOP $ 12.31 $ 11.00 -11%
  TOTAL 715.31 793.63 11%
  AVERAGE 42.08 46.68 11%
  MEDIAN 40.00 46.75 17%

Of the above, StarMedia (NASDAQ:STRM) climbed on a tout from BB Robertson Stephens "buy" rating. I think STRM may hold some promise as a Latin leader, even in the face of Yahoo or even QuePasa.com. Quepasa.com is scheduled to go public this week, with sales of basically nil in 1998 and $6.9 million loss. To me I think it's early to go public on this one.

Problem is, QuePasa.com cannot afford to not go public now that StarMedia, a much larger rival, is already trading and better known, with a marketing war chest thanks to the IPO proceeds.

BackWeb (NASDAQ:BWEB) debuted last week and hovered in the $17 to $20 range so far. BWEB was up 13% since June 17. Part of its challenge is outliving the early push (Internet broadcasting of information) hype that hit the sector in 1996/97.

Ditto Marimba (NASDAQLMRBA), which does similar things. Of the two I think both now have better models and positions than push and provide infrastructure-level services beneficial to corporations that want to regulate bandwidth and dissemination of information efficiently.

Healtheon (NASDAQ:HLTH) stayed flat for the period as investors I believe try and digest its buy of WebMD, a Web-based health site that bolsters Healtheon's Web presence tremendously in my view.

iVillage is down 3% on what I would attribute this to rival Oxygen Media receiving $100 million investment from Paul Allen. Oxygen is owned in part by Oprah Winfrey of gab-fest fame.

drkoop.com fell 11% since June 17. While I liked the Web site I saw the name game licensing as a gimmicky move. It's early in healthcare, however, and perhaps a larger firm may find KOOP just what the doctor ordered.


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