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Technology Stocks : Autoweb IPO 3/22/99 AWEB -- Ignore unavailable to you. Want to Upgrade?

To: grogger who wrote (610)	7/25/1999 11:33:00 AM
From: Kip518	Respond to of 696

ANy thoughts? G, assuming you were addressing this question to me personally, I'll give you my ideas, although I don't think you want to hear them. Once a stock punctures its IPO price it's broken. It has the weight of every buyer on its back. No current longs have made any money (except insiders) and every one is looking for a point to get out to limit losses or breakeven. Any good news(e.g. beating revenue estimates) is used as a opportunity to sell. This, coupled with the generally bad market for internets stocks (likely to get worse as tax selling season approaches)works strongly against AWEB. While some broken IPOs do recover, it takes a lot of time and/or a major shift in market sentiment. In my view, AWEB was simply another in the long list of initial IPO highfliers in nutz-mania market. With the surplus of new internet issues, no distinctive niche, endless competition, huge overhang of stock at higher prices, few new buyers are likely to be attracted to this stock. IMO, AWEB is likely to be just one of a very large number of 2nd-3rd tier internet stocks that will not survive as the internet story continues to stale. While clearly it has some fans (e.g. Harmon), with the decline in its stock price it has pretty much lost the ability to raise more equity capital (i.e. no secondaries) and although not losing money as badly as "experts" predict, like nearly all internet companies it is still bleeding big money. At some point, survival will likely become an issue and folks on the boards will pray for a buyout (which I suppose is not impossible). You have to draw out your own scenarios and make your own conclusions. For me, AWEB is still a good short.