Here's a summary of DD I've been doing on WCAP. I've begun accumulating a position in the stock, as I feel the company is dramatically undervalued, relative to its peers in the Internet incubator space.
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WCAP is an Internet and high-tech incubator (its peers include CMGI, ICGE, SFE, RRRR, etc.) that has been on a buying binge recently. Its portfolio includes companies that specialize in electronic B2B, broadband, wireless services, B2C, consumer and business portals, marketing, software infrastructure, data storage, and semiconductors.
Market cap is about $165 million (5.35 million shares outstanding, 3.90 million float). According to the most recent earnings release, WCAP's shareholder equity is $133,234,348. WCAP trades at 1.24 times book value. Earnings last quarter were $16.75 per share, due largely to unrealized (non-cash) gains on investments.
According to a 15 December 1999 research report from M.H. Meyerson, in recent years WCAP had invested $13.42 million in publicly traded companies when they were still private; the value of those investments, as of 13 Dec 1999, was in excess of $128.4 million. The latest earnings release said that WCAP invested a total of $6,886,237 between 1 April 1999 and 31 December 1999; it invested another $4,425,000 between 1 January 2000 and 11 February 2000. In short, WCAP is stepping up the pace of its investments, capitalizing on past successes and becoming more aggressive going forward.
Investments announced over the past two months include the following:
HomePoint Corporation: B2B distributor and marketer of home furnishings on the Internet
etang.com, Inc.: Chinese language Internet portal aimed at the youth culture in Mainland China
BigFoot IMS, Inc.: direct e-Marketing services company that specializes in strengthening and maximizing customer relationships on-line through e-mail
Open Port Technology, Inc.: Internet messaging: has deployed global IP messaging services for Cable & Wireless, Cable & Wireless Hong Hong, Cable & Wireless IDC, AUCS, Interpath, Tele Danmark, China Telecom, Net2Phone, and MCI WorldCom)
e-Media, LLC: e-Media is a global broadband and e-commerce expert that combines proprietary, multi-media technologies with high bandwidth capacity to deliver consumer-centric Internet experiences for companies in the entertainment, business-to-business and retail fields
NeoPlanet, Inc.: its unique software application combines Web browsing, email, instant messaging and search into a single application, more personalized and user-friendly than the standard browser or online service software: private-label distributors of NeoPlanet software, including Lycos, New Line Cinema, McAfee.com, NEC and IBM.
Publicly traded companies in WCAP's portfolio include Bluestone Software (BLSW: 87,170 shares); Commerce One (CMRC: 590,570 shares); Cyberian Outpost (COOL: 1,364,855 shares); E-Stamp Corporation (ESTM: 141,341 shares); Juno Online (JWEB: 261,846); HearMe, Inc. (HEAR: 228,273 shares); PNV.net (PNVN: 93,750 shares); RoweCom (ROWE: 153,676 shares); Styleclick.com (IBUY: 47,000 shares).
Non-public companies in WCAP's portfolio include Internet Gift Registries (50,000 Preferred B; Warrant to obtain 60,000 Common); Prio, Inc. (116,279 Preferred F); SynQuest (40,300 Preferred G); TeraStor (485,437 Preferred E); Vivid Semiconductor (440,000 Preferred E; 79,366 Preferred F-1); ScreamingMedia (42,000 Preferred); Modacad, Inc.; Pseudo Programs, Inc.; Eprise Corporation (324,675 shares); Aeneid Corporation.
Forthcoming IPOs include Eprise Corporation (underwriters: Deutsche Banc Alex. Brown, Dain Rauscher Wessels, Wit Soundview) and ScreamingMedia (underwriters: Credit Suisse First Boston, Deutsche Banc Alex. Brown, Dain Rauscher Wessels). |
