Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Ticketmaster-Citysearch (TMCS) -- Ignore unavailable to you. Want to Upgrade?

To: Hunter Vann who wrote (122)	12/5/1998 11:07:00 PM
From: neverenough	Respond to of 803

Temco Services Industries (TMCO) saw its stock rise more than 125 percent, from $29 to $65, when a news service mistakenly reported the new Ticketmaster Online-CitySearch (TMCS) stock ticker as "TMCO," rather than the correct "TMCS" symbol. (The mistake reportedly occurred in a Reuters story, but the company denied any errors. ZDNet was also blamed for the snafu.) Such is the power of a hot public offering like Ticketmaster Online's, the USA Networks-backed (USAI) combination e-commerce and city guide Internet company. Its shares bolted out of the gate, from an offer price of $14 per share to open at $52, up $38. The Internet IPO star du jour reached as high as $56.37, a 303 percent increase, but closed at $40.25, up $26.25. That's a stellar gain of 187.5 percent, though short of the absolute monster IPO some traders had expected. How big is big? "We're hearing the first trade could be 100," said a breathless trader in early morning hours, just before Ticketmaster Online made its debut. While a 100-point opening trade was not to be, Ticketmaster's 187.5 percent first-day gain still places it among the top four IPOs of all time (in terms of first-day gains), with Theglobe.com's 605 percent rise, Broadcast.com's 249 percent rise, and EarthWeb's 248 percent rise beating it out. "It's actually the biggest Internet IPO I've seen in terms of first-day market capitalization," states Francis Gaskins, editor of Gaskin's IPO Desktop. "But then again, it's the only one that has an established brand [Ticketmaster] that's a carryover from an existing business [USA Networks]." To be sure, part of the attraction of today's Ticketmaster Online IPO went beyond just its Internet flavor and unique position as a potentially profitable online company. It was the Barry Diller mystique, the visionary aura that surrounds the man with the golden touch, who as CEO of USA Networks has turned the Home Shopping Network into something of a cash cow. Mr. Diller's USA Networks owns a 42.5 million-share stake in the newly public Ticketmaster Online-CitySearch and will conceivably help shape and leverage the online city guide into a significant e-commerce player going forward. "It blends content and commerce very nicely," says Ryan Jacob, portfolio manager with The Internet Fund. "And having USA Networks as a parent doesn't hurt. ... There's value here; it's just a question of what it is." In fact, if analysts could poke holes in anything associated with the Ticketmaster Online IPO, it was simply to question whether the new offering would be able to sustain, not to mention justify, its current $2.8 billion market capitalization. Yet this skepticism is nothing new. Old-school Wall Street has been fretting over valuations assigned to Internet companies ever since Netscape (NSCP) went public back in the old days, and even now continue to whine that companies like @Home (ATHM) or Yahoo (YHOO) or eBay (EBAY) are just completely out of whack with how companies should be traditionally valued. But Ticketmaster Online has a healthy glow all its own that has tended to keep such criticisms muted. "I would consider it a higher prospect than something like Theglobe.com or EarthWeb," says Mr. Jacob. Mr. Gaskins agrees. "It's [a stock] that the institutions will set a floor on," he says. "They won't set a floor on Theglobe.com, but they will on Ticketmaster because it's got some numbers behind it." Setting a floor means that, once the IPO dust has settled and the portfolio managers become more certain of their position on a particular stock, price levels tend to stabilize around a natural minimum trading range. Who are we again? Having netted $98 million on today's offering, Ticketmaster Online-CitySearch enjoyed a healthy payoff for going public. Although much of the proceeds from the Ticketmaster Online-CitySearch offering will go toward repaying a $50 million loan from USA Networks, the company should still have plenty of cash left over to play with as CitySearch attempts to expand its reach beyond the current 13 cities it now has a presence in. And what eventually happened to poor Temco, the building maintenance company that suffered a case of mistaken ticker identity? Unfortunately, its shares settled at $25.50, down $3.25, for a loss of 11.3 percent. Source: Red Herring