Agency.com poised, Organic on deck
By Steve Gelsi and Emily Church, CBS MarketWatch
Last Update: 5:13 PM ET Nov 30, 1999
Net Economy
Net Stocks
NEW YORK (CBS.MW) -- With Internet advertising and consulting on the
rise, the debut of Agency.com is generating a big buzz even as another
long-time firm in the space has filed to go public.
Agency.com (ACOM: news, msgs) is readying its
IPO of 5.9 million shares at a price range of $10 to
$12.
Meanwhile, Organic (OGNC: news, msgs) has filed
to raise $75 million in an upcoming IPO.
Both companies' IPOs are led by Goldman Sachs.
Ad giant Omnicom (OMC: news, msgs) owns
significant shares in both, as well as Razorfish
(RAZR: news, msgs), which debuted at $16 per share on April 26. It's now
trading in the 70s.
Despite the influx of newcomers, Wall Street gurus say there's plenty of
room for more players, especially such well-known names as Agency.com
and Organic.
"The fact of the matter
is, these guys are
turning away business,"
said David Sturtz,
analyst with Volpe
Brown Whelan. "Every
business out there
wants to utilize Internet
technology in some
shape or form."
Sturtz covers Razorfish, as well as USWeb (USWB: news, msgs), Scient
(SCNT: news, msgs), and IXL (IIXL: news, msgs). Each company has its
niche -- such as Razorfish's emphasis on wireless technology -- but the
companies also overlap in offering strategic, technical and creative advice
on using the Internet.
And their shares have been hot. IXL jumped 2, or 6 percent, to 36 on
Tuesday following its new alliance to work with Dow component Home
Depot (HD: news, msgs) on its Internet strategy.
"It's just the tip of the iceberg," said Moshe Katri,
managing director of SG Cowen, who figured the top
15 companies in the space have combined revenue
of $1.5 billion. Meanwhile, industry estimates put the
size of the Internet integration service market at $12
billion in 1999 and $78 billion by 2003.
"While competition is fierce and growing in this area,
Agency.com is one of the premier names in the
space and online advertising has an incredible
future," said Renaissance Capital (IPOSX: news,
msgs), which named the company its IPO of the
week.
Akamai
Akamai (AKAM: news, msgs) Chairman and Chief
Executive George Conrades told
CBS.MarketWatch.com said he sees his
company and Cisco (CSCO: news, msgs) working
together "to develop new standards for the way
content is routed on the Internet."
His comments came as Akamai emerged from its
quiet period after one of the biggest first day IPOs of
the year with a jump of 458 percent on Oct. 29.
Cisco as well as Apple (AAPL: news, msgs) and
Microsoft (MSFT: news, msgs) invested in the company.
Conrades said he tries not to focus on Akamai's soaring stock price in favor
of growing the company's server network and customer base. Meanwhile,
shares of Akamai hit an all-time high of 237 on Tuesday with a rise of 10, or
4 pecent. See IPO First Words.
NBCi
NBC Internet (NBCI: news, msgs) dropped 16 percent on its first day of
trading as the company completed its transformation from Xoom.com to the
first publicly traded Web firm to carry the TV network's brand.
Shares dropped 14 1/2 to 76, but the stock held onto big gains it made
before switching tickers. On Monday, Xoom.com shares gained 17 to 88
1/2.
NBC Internet was formed from the Snap.com portal, the community
services and direct e-commerce of Xoom.com and other NBC properties.
General Electric (GE: news, msgs) and its NBC unit own a 47.3 percent
stake. Xoom.com shareholders got a 38.8 percent share and CNet (CNET:
news, msgs) holds 13.8 percent. See related story.
PFSweb
Shares of upcoming IPO PFSweb (PFSW: news, msgs) got a little pricier
on Tuesday after the Plano, Texas, company upped its price range.
The company, which offers transaction management services for
bricks-and-mortar stores and e-tailers, increased its price range to $14 to
$16, up from $12 to $14.
PFSweb is offering 3.1 million shares with lead underwriter Hambrecht &
Quist.
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