Oh, Praetor, Praetor, Praetor. You had to go and do it, didn't you?
Our forces are now joined, meaning two things:
It'll be a moonshot...
Neither of us could get shares if our lives depended on it...
Seriously, we have the same concerns. And on the GS issue, I'm still holding BNBN shares that I paid $18 for. I always planned to hold 'em, but I sure don't mind telling you that I would much rather have owned them at 14 and change, as was possible. GS is good, but they're not magicians and people aren't gonna support a stock just because they're the ones who brought it to market.
Top seems to be missing in action, so I'm gonna run it through his mill as best as I can:
These are the winning IPOs-- biz.yahoo.com
On their first day of trading investors bid these shares up to more than 10 times their IPO price. What made these IPOs so compelling?
They had many of the following exceptional characteristics Now you
decide whether or not your new IPO has what is takes to be a winner, too:
********************************************************
Will this company emerge as the category leader in its market? Does this company represent the leading edge in its technology products or
merchandising model?
YES=1
NO=0
I don't think so. I believe they've been beat to the punch in every aspect of their market.
********************************************************
Does this company have the "first-mover" advantage over all its
competitors?
YES=1
NO=0
********************************************************
Does this company operate in a big-ass market? Is its market expected
to grow exponentially in the foreseeable future? Does it offer products or services in the "HOT" sectors, e.g., infrastructure, enabling technologies, DSL, wireless internet communication, B-to-B commerce, verticals, hosted services, etc.?
YES=1
NO=0
********************************************************
Does this company have strong brand recognition (the "branding"
advantage)?
YES=1
NO=0
********************************************************
Does this company have a winning merchandising and customer service
strategy? Has it attracted high-profile clients or consumers? Does
the company have multiple (or blended) revenue sources?
YES=1
NO=0
If anybody knows anything to suggest that a YES answer was warranted here, feel free to plug it in.
********************************************************
Does the management team hustle? Have they demonstrated success in
prior public ventures? Does the company have the best people in
this field?
YES=1
NO=0
I think Top might consider re-wording this question. For I think that these guys obviously hustle, but hustle doesn't always translate into the other two. Anyway...
The Chairman and CEO are father and son, respectively, and it appears that they started the company. Here's what they each did prior to starting the company in 1990. (The son would've been around 23 then.)
From the prospectus on the Chairman/Father:
Mr. Hale was president of Hampshire Imports, the original importer of Laura Ashley Womenswear to the U.S. and a manufacturer of exclusive women's apparel, from 1968 to 1992.
From the prospectus on the CEO/Son:
He was employed by U.S. Telecenters, a sales agent for NYNEX Corporation, from 1989 to 1990, and as a sales representative at MCI
from 1988 to 1989.
The rest of the management team listed in the prospectus brings some more telecommunications background in, but I didn't see anything to indicate that any of them are big movers and shakers within the field.
********************************************************
Was this company backed early on by leading venture capital firms?
YES=1
NO=0
Somehow, the father and son prior to the offering manage to beneficially own 100.5% of the company. (49.1% for Daddy and 51.4% for Junior.) I didn't know that was possible.
********************************************************
Is the float relatively small (3-5 million shares)?
YES=1
NO=0
[Here's the float--in millions of shares-- for some recently priced IPOs which are trading at least 100% above their IPO levels (as of 6/18/99):
BRCD 3.2; CMTN 4.0; CPTH 4.5; EXTR 7.0; MKTW 2.7; MMXI 3.0;
MRBA 4.0; PCLN 10.0; PRSF 8.0; PHCM 4.0; RTHM 9.4; STRM 7.0;
SILK 3.0; VERT 3.5]
This float is 8,000,000 shares.
********************************************************
Is this company being underwritten by at least one of the three
best-performing lead underwriters--Morgan Stanley Dean Witter,
Merrill Lynch, and Goldman Sachs?
YES=1
NO=0
These brokers are very careful in choosing the companies they underwrite because they need to protect their long-established reputation for offering quality IPOs and quality investments. If this IPO passes muster with Morgan Stanley Dean Witter, Merrill Lynch, or Goldman Sachs, it's usually a good deal.]
********************************************************
Is there a lot of "BUZZ" about and anticipation for this IPO? One way
to guage this interest is by counting the number of messages about
this IPO on the SI threads.
30 or more messages=1
Less than 30 messages=0
17 messages.
[The buzz factor can add to the appeal of an issue, but the absence of
buzz does not necessarily detract. Some great stocks generate buzz, and some great stocks don't, for whatever reason.
Here are some hard figures on this concept: The PCLN SI thread had 598
messages up to the morning of March 30, 1999, when it began trading.
I believe this is the record number of pre-IPO posts for any issue. PCLN was one of the biggest first-day movers, jumping from $16 to $84.
see techstocks.com
VERT had 69 pre-IPO messages.
On the other hand, an IPO with few pre-IPO messages may still turn out
to be a big winner. Recent examples are RBAK (8 pre-IPO posts), HLTH
(7 pre-IPO posts), CMTN (15 pre-IPO posts), and BRCD (12 pre-IPO posts).
You can also learn more about the "hot" IPOs at this site--
ostman.com ]
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Taking these criteria into account, how does your IPO stack up?
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**********END OF TOPANUUITY TEST*********************
Score as I see it: 2
FWIW, the value of the shares owned by each the Father/Chairman and CEO/Son will be something in excess of $330,000,000 if the issue prices in the middle of the range at $15. The other members of management have some options, but do not own any shares outright according to the prospectus. |
