Something we already knew but FWIW...
IPO UPDATE: CYBERIAN OUTPOST LEAVES MARKET COLD
July 31, 1998
There was no way Cyberian Outpost's initial public offering would take off on Friday, what with Egghead (EGGS) and Software.net (SWNT) trading lower, and the broader markets taking a beating. All the same, it didn't do too badly for itself.
Cyberian Outpost (COOL), an online seller of hardware and software, went out with an offering price of 18. The company raised $72 million on the market with its 4 million shares, and it closed up modestly at 20.50.
Although a small increase for an Internet IPO, it was unsurprising, given the recent performances of its competitors. Software.net opened at 12.88 on June 17 and, although trading as high as 22.88 recently, it closed today at a mere 14.25. Egghead has likewise faltered after reaching a recent high of 29.13. Buoyed by talk of its profitable auction site, it recently declined with its earnings reports. Egghead lost $0.24 a share this quarter and its stock took a plunge, closing today at 14.50.
"Cyberian Outpost is a just a 'me-too,'" says Francis Gaskins of Gaskins' IPO Desktop. "It couldn't possibly scream." Mr. Gaskin also noted that Cyberian Outpost was priced near Software.net's trading range. That's not a coincidence, he suggests.
Repeat customers
Cyberian Outpost does boast higher repeat sales than Software.net, accounting for approximately 48 percent of its net sales in fiscal 1998. In addition, its hardware sales give it a broader focus than Software.net, and it has been stepping up its brand recognition through strategic alliances with AOL, Excite, Lycos-Bertelsmann, and CNet. What it doesn't have, however, is an auction site like Egghead. Could another partnership with auctioners Ebay or Onsale be in the works? |
