This looks like reason for a new upturn in thhe price of HYPR
Read it below or go to:
suntimes.com
Next mission: HyperFeed
November 21, 1999
BY JOHN STEBBINS BLOOMBERG NEWS
It's not as if Jim Porter lacked for excitement or achievement.
As an astrophysicist for the U.S. Naval Research Laboratory in the early 1960s, he
helped NASA launch rockets. Later, with the Central Intelligence Agency, he
assessed the Soviet missile threat.
Then, starting in the 1970s, he became wealthy trading stock options.
For fun, he restores and flies World War II planes and performs with the Lima Lima
Flight Team, a Chicago area air acrobatics group.
So why, after having retired a few times already, did the 59-year-old Hinsdale
resident decide 2 1/2 years ago to take charge of HyperFeed Technologies Inc., a
Chicago-based financial data and Internet company that was teetering near
bankruptcy and still struggles with losses?
"The Internet and the explosion of financial information is where the excitement is at,"
said Porter, sitting in a downtown office decorated with plastic models of favorite
planes.
Porter hoped for Internet riches this year with the proposed spinoff and initial public
offering of HyperFeed's Internet unit, PCQuote.com. But the company postponed
the IPO on Oct. 18, citing a depressed market in financial services. Two weeks
earlier, it had trimmed the number of offered shares and cut the price range to $8 to
$10 a share, from $11 to $13.
Porter, who has served on the boards of the Midwest Stock Exchange, Pacific
Stock Exchange and Chicago Board Options Exchange, said he intends to try again,
probably after Jan. 1.
"He stepped into a barrel of snakes with [HyperFeed]," said Chuck Henry, CBOE
president, who has known Porter since the mid-1970s. "He has turned other
operations around. If I had to bet, I'd bet on Jim."
HyperFeed supplies real-time quotes on stocks, commodities and stock options
from North American exchanges through offices, which it calls ticker plants, in
Aurora and downtown Chicago. Its customers range from America Online Inc.'s
CompuServe to specialty investment companies such as Allen Douglas Securities
Inc. in Winter Park, Fla.
"For features and quality of the data feed and for the price, they are the best you can
get," said Mark Thomes, chief financial officer of Allen Douglas.
HyperFeed developed a compression technology that allows it to process enormous
amounts of data at 4,500 quotes and trades a second, Porter said.
The need for speedy transmission will increase, he said, as more companies go
public and as exchanges switch to decimals from fractions in stock quotes, adding
more numerals to the information stream.
"You are talking about a major leap in the amount of data that will be handled,"
Porter said. "Some of the data providers will be buried. We won't."
HyperFeed fell 18 3/4 cents to close at $5.50 Friday.
HyperFeed shares in the last 52 weeks rose as high as $15.68 3/4 on April 14 from
a low of $1.25 Nov. 18, 1998. Some investors think the stock is poised to climb
again--as evidenced by postings on Internet investors' sites such as Raging Bull.
HyperFeed, which has just 130 employees, isn't followed by financial analysts.
The postings note that Motorola Inc., the No. 2 maker of cellular phones, lent
PCQuote.com $2 million in September and began talks on HyperFeed providing
market information for Motorola cellular phones and pagers.
"We are in discussions with PCQuote.com that are aimed at the goal of making them
the securities-content and financial-tool provider" for Motorola's wireless devices,
said David Rudd, a spokesman for the Schaumburg-based company.
An agreement with Motorola or another large company would be a boon to
HyperFeed, which has lost money since 1996, when two big customers--online
broker Charles Schwab & Co. and Bridge Information Systems Inc.--canceled the
service. HyperFeed was forced to slow spending on technology.
"The company lost sight of how important customers are to the firm and lost sight of
customer service," said Porter, declining to give more details.
Earlier this month, the company reported a third-quarter loss of $1.8 million,
compared with a loss of $911,055 a year earlier. This year's third quarter also
included a charge of $1.4 million to cut short a satellite contract, increasing the loss
to $3.2 million. Revenue rose 37 percent to $8.6 million.
The company lost $6.5 million in 1998, $11 million in 1997 and $3.3 million in 1996.
Porter said he'd hoped to show a profit by now but hasn't been able to because of
costs to improve the company and for the Internet spinoff.
Starting in 1980 as On-Line Response Inc., and renamed PC Quote Inc. in 1988,
the company was among the first to provide real-time financial data for personal
computers. In June, it became HyperFeed Technologies to avoid confusion with its
Internet unit. HyperFeed competes with Reuters PLC, Bloomberg LP and Bridge to
provide financial data.
In 1997, the company considered filing for Chapter 11 protection from its creditors
and hired William Blair & Co. to explore putting the company up for sale. Porter,
who learned about the company from one of the co-founders, considered buying it.
When that fell through, he joined as chief executive that June.
He is paid $180,000 a year. He controlled about 1.35 million shares, or about 9
percent, as of Sept. 30, the company said.
Since he took the job, he's had little time for vintage planes.
Porter and seven other people spent 11 years restoring a B-25 bomber, named
Barbie III, that they discovered in a field southwest of Naperville. He helped restore
a Grumman F4F-3 Wildcat airplane pulled out of Lake Michigan four years ago
after 47 years in the water.
Last month, Porter was stunned when Keith J. Evans died in a crash while practicing
a Lima Lima stunt-plane routine. Porter, Evans and another man were partners in the
plane.
"It was a huge blow to the team and to me," Porter said.
He spends his rare time off with his wife, Sally, whom he met while both were
working at the CIA, and their two daughters. He also flies volunteer missions for
Lifeline Pilots, transporting human organs for transplant patients, or people in need of
immediate medical care.
Most times, he said, he is focused on piloting HyperFeed toward profitability. |
