Most folks had not much reason to buy INPR even at under $5 until Linux promise and msft judgement came along. That's the key here. Rhat won't be of much use without companies like INPR. Why folks buy RHAT now? Again they are buying into Linux' promise even though their FA is worse than INPR. Why folks like us are so bullish on INPR at this point? INPR is The Best and has most potential in tools and server, imho. MSFT can't bully INPR around any more! That's the change we're riding on now. Also we'll see more of "power of individual investors."
This is from barron's;
Consider how the economics of scarcity propelled Durham, North Carolina-based Red Hat's IPO into the stratosphere. When Goldman Sachs took Red Hat public in August, the company reported a loss for the fiscal year ended February 28, 1999, of $130,000 on revenues of $10,790,000, compared with a profit of $8,000 on revenues of $5,156,000 a year earlier.
What drew consumer interest was Red Hat's promise, as the leading provider of the Linux operating system, which is an alternative to Microsoft's Windows. While Linux itself is available free, Red Hat raised money to build a sales and service organization that corporate users require. On August 11, Red Hat raised $84 million by selling six million shares for $14 each. Immediately the stock went to 52, and has traded as high as 302 5/8 . Thursday, it closed at 286 1/4, 1,945% over the IPO price. Individuals have largely been behind this run-up. Island ECN, an affiliate of Datek Online Holdings, the big online broker, has handled the largest share of Red Hat's volume, some 19% of its turnover year-to-date.
Is it hype? Maybe. Is it all hype, nothing but empty promise? You decide.
later,
InSook Prasad |
