theglobe.com Benefits From Hot Internet Stock Market
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The continued demand for new Internet IPOs sent Web community builder company the globe.com's stock out of this world Friday.
After pricing at $9, the company's shares soared as high as $97, making it one of the biggest runs ever for any Internet offering. By the time the market closed, shares of TGLO waned somewhat and dropped to $63.50 per share or 113x revenue. Compare that to the IPO at $9 or a more justifiable 15x revenue. For the first six months this year theglobe.com posted $1.1 million revenue
We attribute the huge gains not to an underlying fundamental business model advantage but simply to the insatiable hunger by individual investors for Internet issues.
At its peak, our analysis shows TGLO traded at more than $1 billion market value, or what we target as 169x estimated 1999 revenue. For comparison, high-flying Internet stocks with brand name and earnings already on the table typically command a 40x to 60x revenue multiple.
theglobe.com's rocket ship follows that of EarthWeb (NASDAQ:EWBX) which debuted this week also to great demand. See InternetNews.com and search the archives of Internet Stock Report for more information.