The IPO of the day, AutobyTel.com. CBSMarketwatch gives it a huge pluck today:
By Bambi Francisco, CBS MarketWatch
Last Update: 10:12 AM ET Mar 26, 1999 Net Stocks
Internet Daily
NEW YORK (CBS.MW) -- Online car-sales referral service Autobytel is expected to
set off sparks Friday when it makes its debut.
Autobytel (ABTL) priced 4.5 million shares at $23, a price 35 percent above original
expectations. Lead underwriter BT Alex Brown, who led the $103.5 million IPO, said the deal
was in "great shape." That may be an understatement if Autoweb's (AWEB) IPO is any
guide. Autoweb went public Tuesday at $14 a share and ended the day at 40, a gain of 185
percent. See full story.
Internet auto sellers are gaining in popularity because of their competitive prices and because
people enjoy shopping for vehicles without feeling pressured by aggressive sales people,
analysts say. Autobytel goes as far as saying traditional sales tactics are "high-pressure."
The market opportunity is huge as well. The U.S. auto market, including new and
used cars, was $667 billion last year and Americans are buying cars at the fastest clip
in a decade.
Currently, Autobytel generates the bulk of its sales from fees paid by its network of 2,700
subscribing dealerships. The relationships work this way: When a consumer decides to buy an
automobile through one of the Web sites, the nearest dealer in the company's network is
notified. The dealer then agrees to call the prospective consumer with a haggle-free,
competitive offer.
Apparently, some of these arrangements haven't been that smooth. Last year, 556
subscribing dealers ended their relations with Autobytel or were dropped by Autobytel.
Autobytel's advertising strategy, under which it spent more than a million dollars a pop for
commercial spots in both the 1997 and 1998 Super Bowls, has cost the company dearly. To
be fair, Autobytel appears to be trimming its sales and marketing costs as a percentage of
revenues from 155 percent in 1996 to 126 percent last year.
After this IPO, Autobytel becomes a $409 million company. Last year, it posted $23.8 million
in sales. It has accumulated losses of $43.3 million.
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Still hot?
Internet services provider OneMain.com (ONEM) ended its inaugural day Thursday with a
17 7/16 rise above its $22 IPO. The Internet service provider priced 8.5 million shares at
$22. BT Alex Brown was the lead banker and Wit Capital was in charge of distributing the
shares electronically
MiningCo.com (MINE) shot up another 11 7/16 to 58 15/16. The New York company began
trading 3 million shares at $25 each on Wednesday.
MiningCo.com operates an Internet navigation service staffed by hundreds of independent
contractors that manage what the company calls GuideSites, each of which focuses on a
specific topic. |
