Flood of IPOs Puts Net Stocks Underwater
Many of these companies also have business plans that seem all too familiar, he said. "There are just too many companies, with too many similar stories, going after the same kind of investor," Roth said. Take e-mail hosting. Three companies now in the IPO pipeline offer that service: Usa.net, Software.com and CommTouch.
But they can't be cheered by the experience of Mail.com, another competitor, which went public last Thursday. The stock sold at $7 a share, down from a planned $12. The stock's first-day gain Friday was just 25%, to $8.75. "Eventually, investors are going to see that although the surface looks the same, when you peek a little further into the story, some of these firms are quite rickety," Roth said. One irony is that just as ordinary individuals have been getting their best chance to buy IPOs, the spectacular instant returns are evaporating.
latimes.com
Not many have over sixty percent of the market. |
