Only Infrastructure Players Need Apply

Not so long ago it took a bit of work to compile monthly and annual statistics for Internet IPOs.

These days it’s a breeze.

For the record, there were only five Internet-related IPOs in November – three fiber-optics plays and a pair of wireless offerings. Last month, the lone ‘Net ticker debut came from a fiber-optics company.

Clearly, when it comes to public offerings, the classic “dot.com” IPOs that flooded the market from 1998 through earlier this year – the Web portals, the content sites, the e-tailers, even the e-commerce enablers – are dead in the water.

Perhaps permanently, given the severe shakeout that is punishing losing, unrealistic business models grounded in hype and heavy up-front expenditures. Even the slickest underwriters can no longer sucker small investors to fall for the “IPO as venture capital” deals that benefited only the investment banks, VCs and corporate executives holding options at below-market prices (which, in most cases, today are below-water prices).

Today investors will only support infrastructure and hybrid offerings, hence the continued interest in fiber-optics and wireless companies that straddle the IP and telco worlds.

Projecting ahead, it looks like the number of ‘Net IPOs this year will be about half of 1999’s total of 258. As for average first-day performance, the days of routine moonshots are long over. Three of the five stocks debuting this month ended their first day of trading down, while the biggest gainer, Optical Communication Products, was up 63% in its opening.

Here are the numbers for Internet IPOs through November:

Average First-Day Return (By Month)

10 Best Internet Debuts of 2000

10 Worst Internet Debuts of 2000

Here are November’s Internet IPOs, listed by date, with first-day performances:

• Nov. 3 – Optical Communication Products (OCPI), 63%
• Nov. 10 – Luminent (LMNE), -1%
• Nov. 16 – Novatel Wireless (NVTL), 13%
• Nov. 21 – Alliance Fiber Optic Products (AFOP), -8%
• Nov. 22 – Telefonica Moviles (TEM), -3%