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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Don Earl who wrote (11925)	1/21/2001 12:44:52 PM
From: TimbaBear	Read Replies (1) \| Respond to of 78659

Hello Don! A few posts back you mentioned VIAN for consideration. As you know, it's NetNet value is right about its current selling price, and the lion's share of that value is in cash. From the most recent 10Q filings I get the following: ". CAPITAL STOCK On June 23, 1999, Viant closed its initial public offering of common stock at a public offering price of $8 per share. The proceeds to Viant from the offering were $50.2 million, net of underwriting discounts and offering costs. On December 13, 1999, Viant closed its secondary public offering of common stock at a public offering price of $47.3125 per share. The proceeds to Viant from the offering were $120.3 million, net of underwriting discounts and offering costs. On February 24, 2000, Viant, effectuated a two-for-one stock split in the form of a 100% stock dividend to stockholders of record on February 8, 2000. All share data in this report has been restated to reflect this stock split retroactively for all periods presented...." Even though they also go on to say:...The Company's Board of Directors has authorized the repurchase of up to $50 million of Viant's outstanding common stock. Under the stock repurchase program, Viant may purchase shares from time to time over the next 24 months in the open market.... My question is: "How comfortable should one be with a company that went back to the well so soon after its IPO?" Most of that cash apparently came from selling stock and not from the business model. Speaking of the business model, their report also says: ..."THE INTERNET PROFESSIONAL SERVICES MARKET IS HIGHLY COMPETITIVE AND HAS LOW BARRIERS TO ENTRY. IF WE CANNOT EFFECTIVELY COMPETE, OUR REVENUES MAY DECLINE OUR REVENUES MAY DECREASE IF GROWTH IN THE USE OF THE INTERNET DECLINES..." In light of the recent major cutbacks in internet advertising that have gotten so much publicity, wouldn't it be reasonable to assume that that means cut-backs in plans to use the internet commercially have also been scaled back? And what of the competitors like ORCL and SEBL and SAP who are major size competitors in the internet build-out/services space, and who started at the top in company size served and are now working their way down the ladder as times get tougher. I'm not saying this company doesn't have appeal selling at these levels, I guess what I'm asking is whether it will also have appeal from lower levels in the future. What will stop the decline? They are currently CFO and FCF positive, so they should hold up better than most, but will it be enough? Just ramblings on a Sunday afternoon :~) Timba