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.
The proposed ticker symbol is FAIM and the lead underwriter is Deutsche
Banc Alex Brown.
Value America: Burning the Flag
In the past, you wrote a negative review on Value America. Are you still
down on the company?
Reply: With a name like Value
America (VUSA)
, it is not easy to be negative. It sounds so, well, un-American. Yet,
I’m still negative.
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.
Another Acronym
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
