"If only I had gotten in on the IPO."
I've said that. So have you. And it's natural to feel that way. We see a new stock that shoots beyond the stratosphere and leaves us to wonder about the IPO that got away.
Of course, actually getting in on an IPO is never easy. Unless you have a chummy relationship with a lead underwriter, you're probably not going to land that original IPO price -- the one that starts to look tiny in the rearview mirror as market optimism hits the accelerator pedal.
You can't win.
Still, what if I told you that you can get in on a few recent IPOs for less than what the underwriters had their prized accounts pay for them? There's a Wall Street term for those offerings; they're called busted IPOs. However, what if I told you that these new offerings aren't broken but simply misunderstood?
Let's get to the list, and then I'll spell out what makes each of these five recent stock-exchange debutantes so appealing.
|
Company |
IPO Price |
Current Price |
Change |
|---|---|---|---|
|
Dice Holdings |
$13.00 |
$9.88 |
(24%) |
|
HireRight |
$15.00 |
$12.49 |
(17%) |
|
Noah Education |
$14.00 |
$7.81 |
(44%) |
|
Giant Interactive |
$15.50 |
$10.80 |
(30%) |
|
Internet Brands |
$8.00 |
$7.90 |
(1%) |
Dice Holdings
Dice went public in July. The company runs workforce-recruitment websites geared to specific industries, and its namesake Dice.com hub is a popular place for tech-job listings. ClearanceJobs.com, meanwhile, appeals to people who have active security clearances and are seeking jobs. The company also recently acquired eFinancialCareers.com, a site that caters to the financial-services sector.
Dice posted a strong quarterly report last month. Revenue climbed 76% higher to hit $38.2 million, and earnings rose by 33% to $4.2 million. Dice also came through three months earlier with healthy growth in its first quarterly report as a public company.
HireRight
Taking the recruiting process one step further, Hire Right went public a month after Dice did. The company provides Web-based solutions to screen potential hires. Companies can't afford to take resumes at face value, and HireRight's appeal is proven. The company's client list includes more than 60 members of the Fortune 500.
Like Dice, HireRight hasn't been a financial slouch since it went public this summer. Last month's third-quarter report reported a revenue rise of 15%. Margins widened on the way to a 74% boost in operating profits. Yet the stock is still trading at a 17% discount to its IPO.
Noah Education
Things started off well for Noah. The Chinese provider of online education went public as appetite in Chinese equities was peaking, and Noah had a great story to tell. The stock popped at the open, but it retreated quickly when the market cooled off.
That's a pity, because Noah is still doing just fine. Two weeks ago, it announced solid fiscal first-quarter financials. Net revenues and earnings climbed 40% and 39% higher, respectively. The company's guidance for fiscal 2008 calls for top-line growth in the 30% to 32% range. The stock shouldn't be flunking out with grades like that.
Giant Interactive
Staying in China, we find Giant, the company behind the popular ZT Online multiplayer game in the world's most populous nation. The company went public with a meatier market cap than niche leader NetEase
Despite governmental concerns over the popularity of Web-based fantasy games, particularly among minors, Giant remains a reasonable proxy for the improving economy in China and the disposable income that comes with it.
Internet Brands
You may be familiar with some of Internet Brands' websites. It watches over automobile portals such as Autos.com and CarsDirect. It also owns several websites that specialize in travel (including Cruisemates.com and VacationHomes.com) and real estate (among them RealEstateABC.com and Loan.com). It also powers many online message boards with its vBulletin platform.
The real-estate-based properties may raise red flags, but overall, Internet Brands is a traffic magnet. It turned profitable in 2004 and hasn't looked back. It attracted 26.7 million unique visitors for September. (As for the continued profitability, a small loss so far in 2007 becomes an adjusted profit once you back out acquisition-related and stock-compensation charges).
Ready to log on?
The market isn't kind to Web-content moguls these days. CNET
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