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Non-Tech : Tulipomania Blowoff Contest: Why and When will it end? -- Ignore unavailable to you. Want to Upgrade?

To: Erick444 who wrote (1466)	5/4/1999 9:17:00 PM
From: charger	Read Replies (2) \| Respond to of 3543

That's funny...I think this board has some of the least emotional folks I've ever come across on SI. If you are long and looking for a contrarian signal, you have come to the wrong place. BTW, the long Treasury bond futures broke support today. The whole market is about to get spanked...it has just begun.

To: Erick444 who wrote (1466)	5/6/1999 12:50:00 PM
From: Sir Auric Goldfinger	Read Replies (1) \| Respond to of 3543

Are IPOs finally getting rational? By Peter D. Henig Red Herring Online May 6, 1999 A rational IPO market? Not quite, but we're getting closer. Not that first-day gains of 67.7 percent for DSL provider NorthPoint Communications (Nasdaq: NPNT) or an even more impressive 134.2 percent for Silknet Software (Nasdaq: SILK) are chopped liver -- but Theglobe.com (Nasdaq: TGLO) they ain't. In fact, the market saw its first "broken" Internet IPO Wednesday with Comps.com (Nasdaq: CDOT), a national provider of commercial real estate sales information both offline and on the Internet. The 4.5 million share IPO was priced at $15 per share by underwriters Volpe Brown Whelan, Everen Securities, and Needham & Company, with Internet distribution provided by ETrade (Nasdaq: EGRP). But it ended down $0.75 at $14.25, even trading as low as $13 per share despite the underwriter's pre-IPO bullishness in raising the size of the deal by 700,000 shares. "I think the market is getting a bit more rational," says Steven Tuen, director of research for IPO Value Monitor. "Especially with the choppy trading and the rotation to cyclicals, investors are acting a little more conservatively, and that's healthy." TIMING IS EVERYTHING NorthPoint Communications performed well on Wednesday, settling at $40.25, up $16.25. Given the strong offerings that its broadband competitors Covad Communications (Nasdaq: COVD) and Rhythms NetConnections (Nasdaq: RTHM) had put together earlier in the year, however, analysts like Mr. Tuen expected the company to trade even higher. Covad had doubled on its IPO in January and now trades more than four times above its IPO price. Rhythms tripled on its IPO last month and, despite a choppy ride since, is still trading at well more than three times its pricing. But technology stocks are suddenly falling out of favor as institutional money rotates into the cyclical stocks, which tend to reflect a broader and more robust economy outside of the tech sector. There's clearly a growing conviction that the pace of IPO pricings may start to slow. "IPOs are all about timing," says Mr. Tuen. "The investment bankers may have gotten a bit too enthusiastic with all of the Internet IPOs when each was soaring over 100 percent." A TREND IS A TREND Underwriters might also be feeling the pinch of their own greed. The stellar aftermarket gains of first-day Net IPOs result from high demand, low floats, and short supply. With 63 new Internet issues since last November -- 38 of which witnessed first-day gains of 100 percent or more -- the supply-demand imbalance among Net IPOs is approaching equilibrium. Investors now have the ability to comparison-shop among new issues, evaluating them for quality and value, rather than hype alone. "Finally, I think I see some rationality returning to the IPO market," says Francis Gaskins, editor of Gaskins IPO Desktop. Silknet Software, a CMGI (Nasdaq: CMGI)-backed deal, might offer evidence to counter Mr. Gaskins's claim; shares of the IPO closed up $20.12 at $35.12. Such bullish first-day action, however, came only on the heels of a late-day rally across the tech sector. A more sober look at the company's first-day action reveals morning trading dangerously close to its $15 offer price, with the IPO only generating gains of 100 percent or higher in the final hour of the day. With so many IPOs scheduled to come to market -- including the much-ballyhooed TheStreet.com and Barnesandnoble.com offerings -- and with IPO filings from the likes of Delta Three and Liquid Audio showing no signs of slowing down, investors might suddenly find their expectations whittled down to little more than minor first-day rises as bullish hype deflates from new deals. "At least, I thought it was looking a bit more rational," says Mr. Gaskins. "But then again, there's still Priceline.com (Nasdaq: PCLN) with a $20 billion market cap. ... I mean, c'mon." While the market might be turning rational, it's not quite there yet.