According to Briefing, ABOV lost $7.35 per share in the quarter (not fiscal year) preceding its IPO. If you shorted ABOV at $15 last December on the basis of the broadening losses, you would have to pay 8 times as much to cover your shorts today.
Scott, you cited:
<<" The company reported fiscal results on March 31, with a 1998 net loss of $5.8 million,
or $5.12 a share, over a 1997 loss of $3.7 million, or $4.11 a share.
Revenues for 1998 increased to $139,000 over revenues of $4,000 in 1997." >>
To show how irrelevant, within the context of pure internet plays, the numbers you cited above are, just take a look at Briefing.com's write up on Abovenet on 12/08/98. At the time ABOV was trading around $15 a share, today it closes way above 100.
ABOVENET COMMUNICATIONS (ABOV):Shares of capital hemorrhaging e-commerce solutions
provider are scheduled to debut this week. This afternoon, lead-underwriter CIBC Oppenheimer announced
that it has boosted the offering range on the deal from $9-$11 to $11-$13 and increased the size by 25% to 5
million shares. The firm plans to price the offering tomorrow night. Hard to believe that institutions are lining up
to buy shares in a company that bled $7.35 per share in the latest qtr, more than double the year-ago $3.14 a
share loss. On an aggregate basis, the quarterly losses were much less startling at $3.35 mln (9/98) vs $0.66
mln (9/97). Going forward, ABOV expects losses to increase significantly from current levels. Specifically,
ABOV manages co-location and Internet connectivity solutions for electronic commerce and other
mission-critical Internet operations. The company derives the majority of its revenues from bandwidth charges,
with additional revenues generated from charges related to space requirements and one-time installation fees.
In Briefing.com's opinion, ABOV could do well over the intermediate-term, but the potential rise in price
certainly won't be based on the company's fundamentals. Until institutional investors can no longer rely on
daytraders to bail them out of these types of substandard offerings, the IPO pipeline will continue to ooze the
AboveNets of the world.
Shares Outstanding: 11.82 million
Market Capitalization: $130-$154 mln
Revenues: 1997= $0.552 mln; 1998= $3.436 mln
Loss Per Share: 1997= $9.17; 1998= $20.68
Price/Sales Ratio: 27-32 |
