Oingo Boingo!

Don't read too much into yesterday's 32% pop at Boingo Wireless (Nasdaq: WIFI  ) .

The provider of Wi-Fi connectivity at airports, hotels, coffeehouses, and other hotspot hotspots may have been one of Monday's biggest winners, but it actually didn't even make back all of the prior week's losses.

Yes, last week was that bad for the 10-year old Internet enabler.

The juice behind the rally is that four analysts -- the same four that took the company public as Boingo's underwriters last month -- chimed in with bullish analyst notes.

None of them pointed out that they got their best clients into the stock at an IPO price of $13.50 five weeks ago. The stock closed at $7.65 last week.

Fans of cruel math will get a chuckle out of the price targets. Deutsche Bank, Credit Suisse, and Pacific Crest initiated coverage with price targets of $15, $14, and $13, respectively. Yesterday's surge makes sense when you consider that these goals are 70% to 96% higher than where the stock caught a breather over the weekend. However, these don't seem like pretty lofty targets given last month's IPO price.

Oh, and shame on you, Pacific Crest. You sold these shares at $13.50, and you're going with a price target of $13. Really? At least join your other red-faced underwriters at the positive side of this busted IPO.

After all, Boingo Wireless isn't that bad. It's profitable and growing. We're not talking about sexy growth here. Revenue climbed a mere 14% in its latest quarter. However, the stock is attractively priced on an adjusted EBITDA basis.

CEO David Hagan was on CNBC yesterday, explaining how the company has been able to grow with minimal capital expenditures because wireless carrier partners often help subsidize the rollouts.

Hagan also tried to position Boingo Wireless as a play on smartphones and tablets given the rise in Wi-Fi chips on portable devices, but that's not an easy sell. The popularity of mobile hotspots through Novatel (Nasdaq: NVTL  ) and Sierra Wireless (Nasdaq: SWIR  ) as well as smartphone tethering are making us rely less on premium Wi-Fi. Sure, Boingo's speed is going to be better than 3G, but it's not as if someone waiting for a red-eye flight out of O'Hare is in a need for speed.

Boingo's biggest shortcoming is that investors think of connectivity as a dying business. They see things through the goggles of traditional consumer-oriented ISPs like EarthLink (Nasdaq: ELNK  ) and United Online (Nasdaq: UNTD  ) .

Boingo is obviously serving a more promising niche, but it's going to take a lot more than four unbiased underwriters to be singing its praises to get this stock above last month's $13.50 IPO price.

Have you bought any IPOs over the past year? Share your thoughts in the comment box below.

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Longtime Fool contributor Rick Munarriz is usually fine with 3G and his MiFi when he's on the road if there are tolls to pay for Wi-Fi connectivity. He does not own shares in any of the companies in this story. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.


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