So you want to get rich? Try IPO's
Written: Jun 25 '00 (Updated Jun 25 '00)
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Pros: clear layout and simple navigation
Cons: No clear way to find upcoming IPO's and pricings
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| mrisch's Full Review: Stockpoint IPO |
The StockPoint Financial Web Site has a simple, non-extensive, but easy to navigate IPO section. It does not really target those who want to jump into the IPO market.
It is located directly at http://www.stockpoint.com/ipo/ipohome.asp, though you can easily navigate there from the home page.
Note that this is a review only of the IPO section. StockPoint.com has a bevy of other financial services that I do not review here
Why do we care?
Why do we even visit these IPO sites, anyway? Unless you work at a company, are “friends and family” of someone who does, or get lucky through an investment service, the likelihood of buying at IPO is very low.
The real reason to check out these sites is to decide whether to get in on a new stock on the first day of trading (or shortly thereafter). IPO’s typically go way up after trading (not as much as say, three months ago), but many will stay put. Further, some hold that high value, and some don’t. The goal of any IPO site is to determine both the short run and long term outlook on a new stock.
Finally, because new IPO companies have previously not been subject to SEC reporting regulations, an IPO site will have the first true, theoretically accurate, news and information about a company.
Available information
The main StockPoint IPO section has a list of current IPO’s and pending IPO’s (SEC filings). You can also search by company name. When I first saw this, I was thinking, “That’s it? Just a list of IPO’s?”
On further examination, it turns out that there is a side frame, text only navigation bar on the left, which allows links to other information. I thought this was a bit hard to find - a better graphical navigation system would work better here. The options are pricings, filings, search, withdrawn, underwriters, and performance. I thought it odd to “search” in the middle - I would have put that at the bottom of the list for aesthetics.
One nice feature is a selection that allows for filtering of primary (first) offerings and secondary offerings, if you truly want IPO or if you want all public offerings.
Company Information
The core information of each company is included in a company information page, which you can access by clicking on any ticker symbol you see or by searching. This page has the basic IPO information, including offering price, last trade price, prior year revenue and income, number of employees, state of incorporation, filing date, and underwriter information. There are also links to company profile, analysis and news pages.
All in all, a relatively complete set of information, but nothing special here.
Pricings
IPO’s are typically priced the night before a stock trades. The IPO price will affect where the stock goes on the first day of trading, and how much money the company will raise. I recently bought at IPO where a company nearly halved its price - this nearly halved the cash intake of the company - if a company is not profitable, this can cost.
So, I go to the pricings page, and there is no pricing information! It shows the amount to be raised based on the price, but that’s all. You have to click to the company information page to find the offering price. This is a seriously deficient layout in my opinion. If I go to a pricing page, I want pricing information.
Thus, it is very important for an IPO site to maintain the most current data, because a one day delay will mean the information is useless.
Filings
This page lists all of the new S-1 statements filed with the SEC requesting an IPO. You can similarly link to company pages, but there is no pricing information. If available, an expected price range will be shown. This information is important, because how a company prices based on its expected range will signal how it sees the market (like my IPO where the price was cut in half - is it any surprise that this happened the day after the market tanked in March?)
Withdrawn
This page shows all the companies that got cold feet and withdrew their request to IPO. There are a variety of reasons for withdrawal, and the reason isn’t listed. What’s missing here (and throughout) are links to commentary and news about the company and why it might have withdrawn.
Underwriters
This is an interesting page, and a new way to organize. This lists the underwriters and the companies they are underwriting. An underwriter buys all of the stock at the offering price (well, actually at a slight discount) and then resells it. This is risky if the IPO tanks. Thus, if you respect the opinions of a particular underwriter, you can see who is supporting what companies.
There are so many underwriters that you have to choose by letter to get to a list beginning with that letter. This makes navigation more complex.
Performance
Aha! The performance page is what I thought the pricings page was going to be! This lists all of the prices, and how the stock is doing now. This can be a valuable resource. The problem is that it doesn’t list them as they are being priced. Only afterward.
The better sites will have a list of filings that shows a filing day, an expected pricing date, and an expected price range, and fill in the actual prices as they come in - all on one page in a table form. This site is missing this simple organization, and it really detracts from the quality. Somewhere between “filings” and “pricings” there should be an “expect to price” page so you know what is coming up this week. Every other IPO site I have seen has this, yet somehow this one does not that I could find.
Search
The search page allows for searching by company name or browsing by letter. It does not have more advanced features, like search by expected price.
All in all, this section has good information if you are not about to jump into the IPO market. However, if you need to know what IPO’s are happening this week, and need to know what the expected price will be, it will take you a lot more work here than at other, better designed sites.
Recommended:
No
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