Hi Dale,
Whew! I can tell the market is pretty sick when you get excited about a few teenies (re. DIGL). I guess we take our pleasures where we can find them. Thought our august "family" might be interested in another IPO peril (does that count as an alliteration? Hope so. <<gg>>) that I picked up from Briefing.com
Unlocked : Seasonal equity market malaise, rising interest rates, IPO inundation. Now we add "lock-up period"
expiration to list of issues afflicting Internet stocks. Shares of Internet-based health care information services
company, Healtheon Corp (HLTH 30 3/4 -8 3/16), filling late May gap as investors attempt to dodge supply
unleashed by expiration of company's 180-day lock-period. According to document filed with the SEC, Healtheon
is now registered to sale almost 17 million shares of common stock, potentially more than quadrupling the
company's current 5 mln share float. Shares of VerticalNet Inc. (VERT 59 1/2 -5 1/4) and Prodigy
Communications (PRGY 15 1/4 -13/16), which came public on the same day as Healtheon, also experiencing some
lock-up related fall out today... Investor fears certainly warranted. Given that majority of recent IPOs are virtually
illiquid and that many insiders/employees will be looking to "diversify" their portfolios by selling company stock at
first opportunity, there is considerable downside risk to many of these issues. In fact, recent price action in some of
January and late February IPOs suggests that insiders have already begun liquefying their holdings. After all, even
with most Internet stocks down more than 50% from their highs, many of these deals still trading at substantial
premium to IPO price. For example, although off 76% from 52-week high, Healtheon shares currently 284% above
$8 IPO price. As an insider or affiliated party, do you take profits in shares that were in many cases purchased at
less than $1 each, or do you let it all ride in hopes of a return to $126 high?... In the attached table, Briefing.com
previews upcoming lock-up period expirations. - DS
Company
IPO Date
IPO Price
Range Since IPO
Current Price
Bottomline Technologies (EPAY)
Feb. 12
$13
$14 - 98
$31
WebTrends Corp (WEBT)
Feb. 19
$13
$22 - 84
$32 1/8
Vignette Corp. (VIGN)
Feb. 19
$19
$37 1/4 - 111 3/4
$53
pcOrder.com (PCOR)
Feb. 26
$21
$26 3/4 - 94
$29
RoweCom Inc. (ROWE)
March 09
$16
$13 1/8 - 53 1/4
$14 3/4
Infosys Technologies (INFY)
March 11
$34
$37 3/8 - 121 7/8
$83
FlashNet Communications (FLAS)
March 16
$17
$15 - 51 1/2
$15 1/2
Cheap Tickets (CTIX)
March 19
$15
$24 - 66 5/8
$43
iVillage (IVIL)
March 19
$24
$28 - 130
$26 1/2
DIGL looks good. What are your thoughts re. founder and chairman retiring?
Jim |
