ARTG rated + 6 out of potential +14
Disclaimer: I have ioi'd for it at WIT
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I'm posting my opinion about this IPO using a 7-factor rating scale.
The highest possible score is +14, the lowest -14.
Please post your opinions about this IPO, too. Let's have a lively
conversation.
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1. Industry-related Factors
Does this company operate in a big-ass market?
Are its products or services in "HOT" sectors, e.g., internet
infrastructure and enabling technologies, DSL, wireless internet
communication, portals and search engines, B-to-B commerce, verticals,
hosted services, etc.?
[Infrastructure includes hardware and software manufacturers:
JNPR, ARBA, PRSW, SWCM, VIAN. Portals and search engines: STRM, GOTO,
PASA, ASKJ.]
Choose from most positive (+2) to most negative (-2)
(_+1_____) ....+2....+1....0....-1....-2....
Your explanation:
Software with internet applications
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2. Company-related Factors
Are this company's sales revenues growing exponentially?
Will this company emerge as the category leader in its market?
Does this company have the "first-mover" advantage over all its
competitors?
Does this company have the leading edge in its technology, products
or merchandising model?
Does this company attract high-profile clients or consumers?
Does this company have strong brand recognition (the "branding"
advantage) and a winning merchandising and customer service strategy?
Does this company have multiple (or blended) revenue sources?
Does the management team have what it takes to lead in its industry?
Does the company have the best people in its field?
Has the management team demonstrated success in prior public
ventures?
Choose from most positive (+2) to most negative (-2)
(__+1____) ....+2....+1....0....-1....-2....
Your explanation:
We have licensed products to over 100 customers. Our customers include 3M, BabyCenter, BellSouth, BMG Direct, Eastman Kodak, Informix, John Hancock Funds, Inc., Network Solutions, Newbridge Networks, Scudder Kemper Investments, Sun Microsystems and TheStreet.com.
Year to Year sales growth up 150%-200%
Mgmt team - didnt see any big names. I was not too impressed.
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3. Venture-Capital Backing
Was this company backed early on by leading venture capital firms?
[Some leading VC companies: Kleiner Perkins, Draper Fisher, idealab.
These venture capitalists are very careful in choosing the companies
they back. It's a good sign when the successful v.c. firms backed
an IPO from its early development.]
Choose from most positive (+2) to most negative (-2)
(__+2____) ....+2....+1....0....-1....-2....
Your explanation:
Tudor Private Equity Fund L.P. (1)... 4,641,219 18.3%
GMN Investors II, L.P.(4)............ 2,080,098 8.2%
SOFTBANK Ventures Inc. (5)........... 1,642,953 6.5%
CHARLES R. LAX has been a member of our board of directors since December 1997. Since November 1997, Mr. Lax has been General Partner of SOFTBANK Technology Ventures. From March 1996 to November 1997, he was Vice President at SOFTBANK Holdings Inc. Mr. Lax also serves on the board of Interliant, Inc., an Internet hosting service company.
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4. Float
Is the float relatively small (3-5 million shares)?
[Here's the float--in millions-- 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; RBAK 2.5; RTHM 9.4;
STRM 7.0; SILK 3.0; VERT 3.5]
Choose from most positive (+2) to most negative (-2)
(_+1_____) ....+2....+1....0....-1....-2....
Your explanation:
5.0 just a tad high
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5. Quality of the Lead Underwriter
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?
[I'd rate these underwriters +2 since they are very careful in choosing
the companies they underwrite and their distribution networks are
top-notch. If this IPO passes muster with Morgan Stanley Dean Witter,
Merrill Lynch, or Goldman Sachs, it's usually a very good deal. IPOs
from CS First Boston, H&Q, and BBRS often warrant a +1. However, when
Volpe or ing Baring are lead underwriters, I rate their effect on the
IPO a -1 or -2.]
Choose from most positive (+2) to most negative (-2)
(__+1____) ....+2....+1....0....-1....-2....
Your explanation:
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6. Buzz / Excitement Level
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.
[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).]
Choose from most positive (+2) to most negative (-2)
(___0___) ....+2....+1....0....-1....-2....
Your explanation:
Neutral - None yet
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7. Current Market Environment for All IPOs
Also, consider performance of first-tier internet companies. Proxy
for IPOs in general might be the Goldman Internet Index or ISDEX
(futures now traded on the Kansas City Board of Trade).
Choose from most positive (+2) to most negative (-2)
(______) ....+2....+1....0....-1....-2....
Your explanation:
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Taking these criteria into account, how does this IPO stack up?
Please post your TOTAL SCORE (i.e., on a scale of 1 to 6) on
the first line of your reply message.
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RESOURCES:
Underwriter's performance
quote.com
Management team and their experience
sec.gov
SEC filings and prospectuses
edgar-online.com
sec.gov
"Hot" IPOs list
ostman.com
Free live 24/7 chat channel devoted to IPOs
chat.yahoo.com
Yahoo's list of the top performing IPOs
biz.yahoo.com
General info on the IPO-ing company
smartportfolio.com
ipomaven.com
ipocentral.com
ipo-fund.com
quote.com
ipofinancial.com
Weekly IPO commentary and analysis
ipo-fund.com
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