E-Mailbag Monday: FairMarket, Value America, XHTML
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What looks hot for the IPO market this week?
Reply: Look for FairMarket to do quite well. The price range was upped to $13-$15 and may be upped more this week. The company plans to issue 5 million shares.
The company is a leading provider of auction technology. Although, sales are still small. Last year they were $2.1 million. As for losses, they were substantial: $16.5 million. Yet, the company has savvy backers, including Microsoft, Excite@Home and Ticketmaster Online-CitySearch. So, it is not surprising that FairMarket's top customers include MSN.com, Excite.com and cityauction.com (owned by Ticketmaster Online-City Search).
Interestingly enough, FairMarket is similar to FreeMarkets (shouldn't there be a trademark dispute here?) Of course, FreeMarkets had a successful IPO and the company now sports a $6.88 billion market capitalization.
Value America: Burning the Flag
In the past, you wrote a negative review on Value America. Are you still down on the company?
On news of its latest earnings report, the company saw its stock price rise $1 to $6-1/16. But keep in mind that the 52-week high was $74-1/4.
Value America has undergone a restructuring, which was badly needed. True, the company announced that it expects to turn a profit at the end of 2001. However, the fact remains that the company is still troubled. In the latest quarter, the company lost $40.8 million. Sales were $61.2 million, which was up from $19.4 million in the same period a year ago.
Currently, Value America has $73.5 million in cash reserves. The reduction in the workforce (by nearly 50 percent) and other cost cutting measures will lead to a much slower burn. Then again, this is likely to give its competitors -- such as Buy.com (flush with cash from its recent IPO) and Amazon.com -- opportunities to take market share. Oh, and don't forget the brick-and-mortar competitors, like Wal-Mart.com.
What is XHTML?
Reply: So long as technology continues to race, we will see more and more exotic acronyms. One of the latest is XHTML. Okay, first of all, you need to know what XML is (it stands for extensible markup language). XML is a standardized language that allows for the interchange of data across different systems. Thus, it goes beyond HTML (hypertext markup language), which was the original language of the Web and was fairly static.
XML is very important in the business-to-business marketplace, in which companies have many different computer configurations. As for XHTML, this combines HTML and XML. That is, it integrates the power of data interchange of XML with the great formatting features of HTML.
Will FairMarket zoom in its debut? Discuss it here