dcsimg
RealTime IT News

The Newbies Keep Going, Up 39 Percent As A Group

The real test of the Internet IPO market is not the first-day rush but the aftermarket burn that can send shares higher or can leave investors charred from the aftermath. My analysis of the IPODEX shows the group up 39% since March 4, a strong indicator of the health of the public offering window.

The news couldn't have come at a more opportune time as this coming Monday iVillage could price. Other news about iVillage has been making headlines, however, including a former employee claiming stock options are due to him and an accountant claiming accounting errors.

Whether or not those headlines hurt iVillage is not known but I don't expect the headlines to impact iVillage's demand as this NBC-backed women's network on the Web looks like it has keen interest.

Company Stock IPO share 10-Mar Change from Percent 10-Mar High % 10-Mar Low %
name Symbol price close IPO change vs. 4-Mar % of high vs. IPO % difference/low vs. IPO
MarketWatch MKTW $ 17.00 $ 67.56 297% 9% -48% 665% 21% 229%
Healtheon HLTH $ 8.00 $ 42.13 427% 56% -13% 508% 94% 172%
VerticalNet VERT $ 16.00 $ 106.25 564% 94% -11% 650% 206% 117%
Allaire ALLR $ 20.00 $ 54.00 170% 14% -22% 245% 59% 70%
Pacific Internet PCNTF $ 17.00 $ 39.00 129% 26% -56% 418% 49% 54%
Prodigy PRGY $ 15.00 $ 40.75 172% 16% -20% 238% 104% 33%
Vignette VIGN $ 19.00 $ 72.00 279% 62% 32% 188% 93% 96%
WebTrends WEBT $ 13.00 $ 41.06 216% 33% -10% 252% 87% 69%
  TOTAL $ 125.00 $ 462.75 270% 39% -24% 385% 84% 102%
  AVERAGE $ 15.63 $ 57.84 270% 39% -24% 385% 84% 102%
  MEDIAN $ 16.50 $ 48.06 191% 21% -22% 275% 60% 83%

Other IPO hopefuls that have brand appeal include theStreet.com, eToys, and AutoWeb perhaps among the onslaught of more than 30 deals oozing down the pipeline.

All of which could fog the IPO window as the glut adds noise to an already noisy IPO market.

One gauge of either how much money was left on the table the first day or the demand being ballistic is the 270% run from IPO price. While that's not the price most investors get in at it indicates the sprint in the legs of these offers.

A better gauge is the 39% run since March 4 for this group. Another key gauge comes in the 84% average trading level above the collective lows.

Anyone who bought in at the highs hurts, though, as IPODEX is off 24% on average from the tops. Of the 8 IPOs listed here this year 3 hit new highs the past week.

I was amazed that VerticalNet (NASDAQ:VERT), in particular, broke out and soared to $120 per share, up 94% since March 4. VERT got a buy tout but I see a long way for meatandpoultry.com and its similar efforts at attaining critical mass in users and revenues.

Prodigy (NASDAQ:PRGY) reported fourth quarter revenue of $34.7 million vs. $32.3 million 4Q97 on narrowed loss of $17.2 million vs. $49.3 million loss same Q last year. The good news for PRGY was subscribers were up 129% to 505,000 vs. 4Q97.

I think PRGY on a value per sub basis looks frothy vs. the larger Earthlink (NASDAQ:ELNK) and Mindspring (NASDAQ:MSPG). PRGY value per sub is about $4,700 vs. $2,000 to $2,700 range for ELNK and MSPG, respectively.


HotWatch '99 by Steve Harmon offers a monthly insight into the hottest stocks in the Internet, his top picks for 1999. Last year's picks by Steve gained 312%. Each month a new report, delivered to you via emailclick here for more info -


Accolades for Internet Stock Report:

"Fresh and provocative" -CBS Marketwatch, who named Steve Harmon one of the top Internet stock analysts and only independent one honored

"I am a huge fan of Steve Harmon's analysis" -Kleiner Perkins' John Doerr