Great points, both of you. The one nuance that wasn't quite driven home, IMO, is that the people and entities that are now free to sell are, in large part, the same ones who have understood all along that the stock was worth $8 or so. HLTH and KOOP, to name a couple, have enjoyed ridiculous valuations only because of the huge number of retail investors who seem not to have understood that, ultimately, a stock's price must be supported by earnings. Healtheon potentially has some earnings; WebMD has none.
I won't rehash the arguments I've made recently on the KOOP thread, but the punch line is that there are too many health information sites and not enough potential revenues from advertising to make any of them successful without other revenue streams. HLTH may actually survive and even thrive if it can keep WebMD's cash burn down and use it as a loss leader for its billing and other services. KOOP's prognosis, IMO, is much bleaker. Still, I wouldn't be surprised to see HLTH back in the single digits by the time all those newly tradable shares have found homes. -Eric |
