I'm still holding DCLK, as it kinda tanked the last half hour of trading. Did you ever find out why it rose so much on Friday?
Here is some info that addresses this. Also a bunch of other stuff. Enjoy.
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This is a release from November. It is followed by an article and then Friday's secondary offering information. This is likely the reason behind DCLK's recent move. DCLK has been on the road drumming up support and it seems that people have generally liked what they are hearing.
DoubleClick Inc. Files Registration Statement for Public Offering [2.5mil shrs]
Company Press Release, Wednesday November 18, 8:51 am Eastern Time
SOURCE: DoubleClick Inc.
DoubleClick Inc. Files Registration Statement for Public Offering
NEW YORK, Nov. 18 /PRNewswire/ -- DoubleClick Inc. today announced that it had filed with the Securities and Exchange Commission a registration statement relating to a proposed public offering of 2,500,000 shares of its Common Stock. All of the shares are being offered by the Company. The managing underwriters for the offering are Goldman, Sachs & Co., BT Alex. Brown, Donaldson, Lufkin and Jenrette, and Salomon Smith Barney Inc.
...full release here: biz.yahoo.com
___________ The article...
DON'T HOLD THAT SECONDARY!
By Peter D. Henig
Red Herring Online
November 20, 1998
If IPOs are suddenly smelling cash, secondary offerings are not far behind, as two Internet companies prepare to offer a second round of shares to the market.
Inktomi (INKT), the Internet search and caching firm, will offer 3 million shares to the market in its first secondary offering since going public in June, when it sold 2.2 million shares at $18 each in a monster debut.
The company itself will offer 300,000 shares, and certain stockholders and company insiders will offer 2.7 million, now that their 180-day lockup period is over.
At the same time, DoubleClick (DCLK), the Internet advertising solutions company that's regarded as the market leader in its space, has also just filed its intentions to do a secondary offering of 2.5 million shares.
Analysts approve
Neither of these secondary offerings should be regarded as foolish or surprising moves.
"It's smart of them to do it, especially when their valuations are high," says Dana Serman, Internet analyst with Schroder & Co. "They suffer very little dilution and they get to raise a ton of cash."
In fact, Mr. Serman contends that it is unlikely that these offerings will even dilute the value of their stocks.
"If investors feel that the $400-500 million raised, when put to work, could improve the company's bottom line, that could outweigh the extra number of shares being put out on the market."
Rather than have a short-term oversupply, or overhang, of available stock that could be offered on the market after the lockup period has ended, companies typically will sell such shares in one fell swoop, generally to institutional investors.
"It benefits the company as much as it benefits the institutions who are trying to establish a position in these stocks without bidding up the share price," says Ryan Jacob, portfolio manager with The Internet Fund. "These names are volatile and very thinly traded, and that much stock being sold, if it's not executed in orderly way, could create problems."
And this may just only be the beginning. Keith Benjamin, Internet analyst with BancBoston Robertson Stephens says he expects to see more secondary offerings, "given the current display of interest." And when we ask whether they are a necessary evil in this high-growth Internet environment, Mr. Benjamin replies, "They are only evil if they don't work out."
Secondaries' second wind
The interesting thing is that secondaries had taken a breather right along with the lousy market for IPOs.
Investors had remained shellshocked during September and October following the market's panicked 29 percent selloff, and except for Broadcom's offering (BRCM), secondary issues seemed nonexistent. This is in stark contrast to earlier in the year when Lycos (LCOS), Preview Travel (PTVL), Sportsline USA (SPLN), N2K (NTKI), and other Internet plays all sought secondaries one right after another.
Now, with DoubleClick's secondary to sell an additional 2.5 million shares of stock beyond the 16.5 million it currently has outstanding, "it looks like we've got a market here all over again," says John Fitzgibbon, editor of the IPO Reporter.
Given a recent price of approximately $34 per share, DoubleClick is hoping to raise about $85 million for the company.
Its underwriters, Goldman, Sachs & Co.; BT Alex. Brown, Donaldson, Lufkin and Jenrette; and Salomon Smith Barney, were granted a 375,000 share overallotment option, which if exercised would provide the company with another $12.8 million.
But the unusual thing about DoubleClick's secondary offering is that none of the insiders are selling; according to Mr. Jacob, all of the shares are being offered by the company.
"That's rare," says the portfolio manager. "Inktomi is more normal; it's a mix."
It's especially rare, given that insiders are usually clamoring to cash out some of the shares they had so dearly longed for prior to the company's IPO -- perhaps garnering a little extra pocket change for some pre-holiday online shopping.
"When stocks run up like thunder, insiders try and cash out so that their wives can have their fur coats for Christmas," says Mr. Fitzgibbon. "Or maybe their girlfriends a Porsche."
_________________Fridays secondary pricing info.....
DoubleClick's Additional 2.5 Mln Shares Priced At 34 7/16
New York, Dec. 11 (Bloomberg) -- Following are the details from
DoubleClick Inc's additional offering of 2.5 million shares at a price of
34 7/16.
Company: DoubleClick Inc.
Lead Manager: Goldman, Sachs & Co.
Common: 2.5 million
Price: $34.4375
Amount: $86.09375 million
Gross Spread: $1.72
Selling Concession: $.95
Underwriting Fee: $.42
Management Fee: $.35
Reallowance: $.10
Trade Date: Dec. 10, 1998
Settle Date: Dec. 16, 1998
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Here is a link to all of DCLK's essential stats.
stocksheet.com
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A recent article....
Internet Advertising Firms to Gain From European Web Surge: Taking Stock
Internet Ad Firms to Gain From European Web Surge: Taking Stock
London, Dec. 1 (Bloomberg) -- DoubleClick Inc. shares and those of other fledgling Internet advertising sales companies are set to rise as consumer goods advertisers prepare for a surge in online use by Europeans.
Ford Motor Co., British Airways Plc, Coca-Cola Co. and other household names will be contributing to a rush in Internet ad spending in the next few years, which research firm DataMonitor expects will balloon to $1.9 billion in 2002 from $180 million this year. ''I think we'll start seeing a significant shift towards interactive from traditional media spending within two to three years,'' said Patrick Semple, executive creative director of Bates Interactive, part of Cordiant Communications Group's Bates Worldwide ad agency.
In four years, 43 million households in Europe are expected to be wired to the Internet, up from 12.5 million this year, according to DataMonitor. As use takes off, multinational advertisers like jeans-maker Levi Strauss & Co. are taking Cyberspace more seriously as an advertising medium.
And as Internet distribution improves, companies like Dutch- British Unilever, the world's second-largest household products maker, are eager to tap into this educated and affluent market. Unlike TV, radio or magazine advertising, the Internet permits ''us to open a dialogue with our consumers, which will make us smarter about what it is that governs brand-building in the digital age,'' said Richard A. Goldstein, president and chief executive of Unilever United States, in a recent speech.
Room to Rise
The shares in DoubleClick, which places advertising for clients on the Internet, have more than doubled in the last six weeks. With the stock down about 46 percent from its record high of 75 5/16 in July, there's still room for it to rise, analysts said. Yesterday, DoubleClick shares fell 12 7/8, or 24.12 percent, to 40 1/2.
DoubleClick's nine-month revenue increased 160 percent to $51.1 million from $19.7 million and will likely prove attractive to investors, who have tended to judge money-losing Internet companies by their top-line revenue as opposed to their bottom-line profit. DoubleClick told the Securities and Exchange Commission that it expects to incur losses at least into 2000.
Other shares set to gain as consumer marketing companies increase Internet ad spending include 24/7 Media, Inc. and NetGravity Inc., which sells Internet advertising management software. A fourth company called InfoSpace.Com, which also sells Internet ad time, is scheduled to go public in December, analysts said. ''To the extent that the rising tide of Internet advertising lifts all boats, DoubleClick will certainly be one of them,'' said Scott Reamer, an analyst with SG Cowen & Company in New York.
DoubleClick, which has offices in 14 countries and ad placement arrangements with some 4,200 Web sites, confirmed that its customers are increasingly targeting Europe. ''It's not only more repeat business from big marketers, but new ones as well,'' said Amy Shapiro, corporate communications director at DoubleClick in New York.
Shares in 24/7 Media finished at 27 3/4, down 6 3/8, or 18.68 percent. NetGravity saw its shares close at 21 1/4, down 4 3/4, or 18.27 percent.
Delivering the Goods
Companies like Coke have avoided advertising on the Internet, in part due to problems getting online purchases delivered. They have generally lagged computer and financial services companies such as International Business Machines Corp. or Citigroup Inc. in exploiting the Internet's marketing potential. ''In 1997, the Web was still mainly the reserve of computing advertisers targeting their technophile audience,'' said London's Fletcher Research in a recent study of Internet banner advertising in the U.K. This year ''has seen financial services advertisers take to the Web, whose male, professional and wealthy audience fits tightly with the target audience for complex and premium financial products.''
As product distribution problems get solved, more mainstream marketers are jumping online.
Soap and Shampoo
Last August, Unilever began selling products like Dove soap and Thermasilk shampoo in the U.S. through Netgrocer, a New Jersey-based Internet grocery store, said Stephen Milton, a Unilever spokesman. Consumer purchases are delivered via overnight mail.
A month earlier, the company signed agreements, which include advertising, with Microsoft Corp. and America Online, Inc. ''Netgrocer is not a huge spend, but the Microsoft and AOL commitments run into the millions of dollars,'' Milton said.
Other companies haven't waited for distribution questions to be resolved, relying instead on the Internet's ability to reach millions of potential consumers around the world simultaneously with product information.
Levi's just concluded its sixth ad campaign on 100 different European servers, said Andrew Walmsley, head of digital media at London's Bartle Bogle Hegarty, the ad agency which developed the campaign through its Motive Media group. Levi's ''views online advertising as strategic but relatively few advertisers have this appreciation,'' he said.
The U.K. Model
In the U.K. alone, total Internet ad spending in the U.K. is expected to grow to $440 million in 2002 from around $42 million this year, according to DataMonitor, while Fletcher Research said consumer companies are already creeping into the top echelons of current Internet ad spending.
In the six months to August, Fletcher said British Airways was the sixth largest Internet advertiser in the U.K., investing 125,000 pounds ($206,000). BA ranked behind computer and technology-oriented companies including lead spender IBM (420,000 pounds), Hewlett-Packard Co., British Telecom Plc, Microsoft and Dell Computer Corp. Ford was in seventh position, with online bookseller Amazon.Com Inc. in 12th.
Consumer marketers in the same period saw their share of overall ad spending on the Internet grow to 16 percent from 4 percent, while computing products and services fell to 23 percent from 34 percent and financial services inched up to 26 percent from 23 percent. Fletcher said it expects the trend to continue, with much of this volume growth expected to pass through companies like DoubleClick. ''Many high-spending ad giants are still not online due to a mixture of inertia, lack of information and skepticism,'' it said in a document. ''We expect this situation to improve, as major companies put their e-commerce strategies in place, many will have to face up to Web advertising. Ad sales houses, such as DoubleClick, will grow in importance.''
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Another recent article.....sorry about the charts
From Briefing.com.."Roadkill on the Information Highway
The bigger they are, the harder they fall.
Never was this statement more true than with the Price/Sales ratio.
And never was it more important than with Internet stocks.
The recent explosive rebound in Internet stocks has driven the price/sales ratios of many stocks into atmospheric levels.
The Price/Sales ratio is the single most important statistic when calculating the implied growth rate of a stock. A high Price/Sales ratio indicates the market expects explosive revenue growth out of the company for as far into the future as the market can see. With Internet stocks especially, there isn't, usually, any way to calculate the upper limit. We are still so far from the maturation of the Internet that it is hard to calculate when growth will level off.
But the moment a stocks shows any indication of someday reaching an upper limit, or just falls out of favor, its value drops rapidly, even if the company continues to grow strongly.
For examples, it is worth looking at some of the roadkill already piled up on the information superhighway.
Examples
Briefing complied a list of some of the once-hot Internet companies that have fallen. All of these stocks had the following traits in common.
•Price/Sales ratio of greater than 25 at the peak •Fallen stock price from all time high of at least 50% •TTM revenues currently higher than they were at the time of the stock peak, with no year-over-year quarterly declines in revenues
In other words, each of the following stocks have seen their business continue to grow, in terms of revenue, which is pretty much the sole criteria for most Internet stocks right now. But, despite that fact, every one of these stocks entered a huge downward slide, in most cases, uninterrupted by rebounds.
CompanyStockHigh PriceDatePrice 10-27% LossN2KNTKI34 5/84-14-985 11/16-84%CDNowCNDW394-14-988 3/16-79%VocalTecVOCLF33 1/410-16-976 7/8-79%NetSpeakNSPK33 1/84-2-987 23/32-77%CyberCashCYCH27 3/44-16-988 1/4-70%NetGravityNETG32 1/27-7-9810 1/4-68%DoubleclickDCLK77 1/87-2-9825 1/8-67%CheckPointCHKPF50 1/211-5-9723 1/4-50%
Note that in the above table, most of the declines occurred over only six months. The longest time period is one year, for VOCLF.
The following table shows that the lower valuations placed upon the stock is the primary reason for the stocks decline, as the revenue for each company has increased. Revenue is shown as Trailing Twelve Months (TTM) at the time of the high price, in millions. Price/Sales ratio is shown as P/S.
CompanyStockP/S at HighP/S NowRev. at HighRev. NowN2KNTKI28317.232.3CDNowCNDW25324.843.3VocalTecVOCLF26413.820.1NetSpeakNSPK7795.48.6CyberCashCYCH72135.510.2NetGravityNETG6257.09.1DoubleclickDCLK33633.361.9CheckPointCHKPF36327.956.5
Some of these companies are twice as big as they were six months ago, but the stock price is 1/4 what it used to be.
The Lesson
What's the lesson behind these stocks?
All of these roadkill stocks once had the same appeal that current hot Internet stocks have: virtually unlimited upward growth, with no foreseeable limits on the horizon. Investors rushed in to be a part of it. But, in each case, when sentiment changed on the stocks, the downfall was tremendous, simply because the valuations were so lofty. Even though the underlying businesses continued to grow, the valuation the market was willing to give them declined, with disasterous consequences for the stock price.
The lesson therefore, is that the risk for many Internet companies isn't that they won't grow, it's that the market won't value the growth like it used to. Unfortunately predicting revenue growth is easier than predicting market sentiment.
Is it possible for a stock like EBay (EBAY) to be twice as big six months from now, but the stock be half the price it is now? Hard to believe right now, but the history of the stocks above says that it is possible.
Change in Sentiment is Key
At lofty Price/Sales ratios, all it takes for a stock to collapse is a change in sentiment. Sometimes a single quarter of less than expected revenue growth is all it takes.
Sometimes its an uncontrollable development. The internet telephone stocks have both been hit hard by the possibility of new laws requiring them to pay owners of the internet backbone for carriage of telephone calls. The laws aren't even enacted yet, but the effect is just as harsh, nevertheless.
Sometimes its just a movement away from the stock, as active traders just move to the next hot thing.
What to look for? Here's a short list of "Mack Trucks," any one of which could cause a sharp drop off in the valuation the market is willing to give, and make roadkill out of your stock.
•A dropoff in the rate of growth, on a sequential basis. •A large, unexpected single quarter loss, or earnings shortfall •Advent of new law or regulation affecting the company •Advent of a new competitor •Emergence of a new, different "hot" sector or stock •Continuing drop-off in daily volume
Most internet investors think the only risk is that revenue growth will slow, but the roadkill above shows that isn't what does it. It's the change in sentiment, and understanding what drives that isn't easy, but it is the key to knowing when to get out, when valuations are as high as they are for Internet stocks. "
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The following was taken from the DCLK web site....
DoubleClick Press Kit
Overview
DoubleClick is the industry leader at leveraging technology and media expertise to create solutions that help advertisers and publishers unleash the power of the Web for branding, selling products, and building relationships with customers. Simply, we are in the business of making advertising work on the Web.
The DoubleClick Network is our flagship product, the first network on the Web that set the standard for the network model of advertising on the Internet. The DoubleClick Network is a collection of the most highly trafficked and premium branded sites on the Web (AltaVista, Dilbert, US News, Macromedia and over 60 more). This Network of sites is coupled with our proprietary DART targeting technology that allows advertisers to target their best prospects based on the most precise profiling criteria available. DoubleClick then places your ad in front of your best prospects.
Comprehensive online reporting lets advertisers know how their campaign is performing and what type of users are seeing and clicking on their ads. This high-level targeting and "real time" reporting provide a speed and efficiency not available in any other medium.
In September 1996, after repeated requests from large publishers, DoubleClick made the strategic decision to license its DART technology to sites with an established sales force. DART is not a shrink-wrapped software package, but rather a comprehensive Web-based service which allows a site (or network of sites) to manage all their ad serving and reporting functions through DoubleClick's central servers. DART provides a full-service management solution to content providers, guaranteeing the same expertise and efficiency that have made the DoubleClick Network a success. Some of our DART clients include The Wall Street Journal Interactive Edition, NBC, Excite Europe, Reader's Digest and Real Network's Real Audio.
This past summer, DoubleClick answered the needs of a different group of advertisers with the creation of DoubleClick Direct. DoubleClick Direct is a response-oriented Web advertising solution for direct marketers looking to reach users on a cost-per-action pricing model (cost-per-sale, cost-lead, cost-per-download, cost-per-click). Through Direct, marketers can view their campaign in "real time" as opposed to waiting months for mail-in results or phone tallies. This instantaneous reporting provides efficiency never before realized in direct marketing, and allows advertisers to modify their creative at any point during the campaign to increase effectiveness.
DoubleClick has a true global presence. With DoubleClick companies building Networks around the world, we can sell a site's traffic on a global scale to advertisers from any country. We will locate the appropriate destination for an advertiser's online marketing campaign and recommend an ideal solution that can be seamlessly integrated into an existing strategy.
DoubleClick is constantly working to develop new advertising solutions based on the response of the hundreds of advertisers we work with every day. Some of our innovations include TestIt!, ClickBoosters, Spotlight, and the powerful addition of Psychographic Targeting to our targeting abilities.
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a small editorial on DCLK's DART system...
In both of the last two conference calls, DCLK execs have noted that one of the great selling points of DCLK DART is the company's broad product line. That is, rather than merely selling an ad-serving service, the DART salesmen can also offer to sell excess inventory with DCLK direct, international inventory through DCLK's foreign offices, and local inventory through DCLK local. Doubleclick is, thus, offering a wide range of services that represent far greater value than mere ad serving.
In today's interview, we see a concrete example of that kind of relationship in action. More than a month ago, we uncovered the fact that DCLK was serving ads for Sportsline (a top 25 site). Today, we find that the relationship is actually broader than that. Doubleclick is also selling Sportsline's international inventory (and, remember, selling ads brings in far more money than serving them). So, whenever some bloke in England logs on to Sportsline to check on a Tennis star or somesuch, he will see an ad sold by Doubleclick. The same goes for an Australian logging on to Sportsline, a German, etc.
I think this shows us exactly why Doubleclick has been spending so much money to establish offices abroad. Even the biggest sites cannot afford international sales teams, so Doubleclick will be there to help. Excite Italia has Doubleclick sell its ads. Internet Movie Database (evidently very large) has Doubleclick sell its UK ads. Sportsline has Doubleclick sell its foreign ads. Looksmart has Doubleclick sell its foreign ads. After a while this could "ad" up to something big.
that is all for now
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