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E-Mailbag Monday: IPOs, Healtheon, Analysts

What looks good in the IPO market this week?

Reply: Oplink Communications should be explosive. The company develops components for fiber optic networks. Customers include JDS Uniphase, Lucent, AdVA International and Sycamore Networks. Also, Cisco is an investor.

In terms of the financials, the company has been growing at a rapid clip. In the past six months, revenues were $39.1 million, which was a 329.4 percent increase from the same period a year ago. The company also has revenue backlogs of $54.6 million.

The company plans to go public this week. The lead underwriter is Robertson Stephens and the price range is $14-$16 (the company plans to issue 13.7 million shares). The proposed ticker symbol is OPLK.

The Vitals on Healtheon

What's your outlook on Healtheon?

Reply: I've written about the stock on several occasions and I'm still bullish. Although, the company's plans of being the dominant online player in healthcare is obviously ambitious and will be a long-term process.

Last week, there were further signs that Healtheon is making the right choices. The company got board approval for a multi-phase plan to reduce costs (by as much as $250 million by the end of 2001) and integrate technologies. After all, the company purchased a spate of companies over the past year, such as Medical Manager, OnHealth, CareInsite, and Envoy.

With the restructuring, Healtheon will be able to focus on its core competencies. These include transactional systems for physicians, clinical applications and content.

What side is an analyst on?

What is the difference between a buy-side and sell-side analyst?

Reply: First of all, a buy-side analyst is a stock analyst employed by a firm that invests money, such as a pension, insurance company or mutual fund. However, these analysts typically do not publish their reports for the public. As for a sell-side analyst, this is a stock analyst that is employed by a brokerage firm. And, of course, these analysts will publish their reports (or, at least, ratings) for the public.



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