Zynga brings much-needed cash crop to IPOville 5 Jul 2011 Tech firms have gone to market by the bushel with little earnings in tow. Zynga arrives with income aplenty from online games like FarmVille. Most of it was harvested from Facebook, but that risk is manageable. And Zynga's profitability is even more bountiful than first appears.
Hedge funds realize baseball is too big to fail 27 Jun 2011 JPMorgan's Highbridge is the latest to bail out a struggling team. Its $150 mln loan to the bankrupt Los Angeles Dodgers follows David Einhorn's New York Mets investment. Bad finance may be hurting the game's popularity but America's pastime still looks a good longterm bet.
HomeAway IPO too reliant on bought-in growth 27 Jun 2011 The vacation home rental listing service is the latest Web outfit seeking an outsized IPO valuation above $2 bln. The business looks solid, yet the firm has goosed expansion through M&A. Investors are hungry for growth, but they should be warier of the acquired kind.
Imagine if Groupon’s wacky accounting caught on 13 Jun 2011 The Internet coupon startup seeking a $30 bln value wants investors in its IPO to ignore silly things like marketing expenses, acquisitionrelated costs and stock compensation. If these financial standards were applied to other companies, the world would be a far richer place.
Pandora’s huge price tag misses old-school model 3 Jun 2011 The online radio group's IPO seizes on the Internet hype with a potential $1.4 bln valuation. But as cool as the service may be, its reliance on radio ads isn't too novel. Investors also should appreciate the lack of operating leverage and avoid getting swept up in the frenzy.
Lady Gaga’s monster sales are frightening indeed 2 Jun 2011 The 1.1 mln tally for Born This Way is the biggest first week for an album since 2005. But it's no turnaround for the music industry. It took a year of hype and Amazon basically gave away 40 pct. Even if concerts are now center stage of the model, big hits really aren't.
Groupon IPO another bet on profit-free sales 2 Jun 2011 The Internet coupon company's revenue trajectory looks like a moon shot started in late 2008, the firm racked up $645 mln in revenue in Q1, 15 times what it brought in a year earlier. But profit looks like a submarine voyage so far. It's another test of dotcom optimism.
Mets deal gets even a financial star starry-eyed 26 May 2011 David Einhorn, the hedge fund boss who famously shorted Lehman, is poised to buy a $200 mln stake in New York's lesser baseball team. Yet the managers of the Bernie Madoffstricken Mets share some of the bankrupt bank's flaws. Sports investments are just different.
Dollar Thrifty rivals drive too hard a bargain 9 May 2011 Hertz pulled a Uturn by returning with a hostile $2.2 bln bid to challenge the stalled Avis proposal. But when considering Dollar Thrifty's improved performance and deal synergies, the sweetened offer still looks too low. Either Avis or Hertz needs to step up with more money.
Netflix pay scheme inspires behind the scenes 9 May 2011 Blockbuster's new owner and Time Warner's CEO are the latest to be won over by the movie streaming service. But one feature of its success is less well known: the way it allows staff to tailor their compensation mix and awards options on a monthly basis. It's worth a peek.
Warner Music’s $3.3 bln sale cues up same old song 6 May 2011 Under Edgar Bronfman the company bested rivals but is still selling to Len Blavatnik for half the 2005 IPO price. The billionaire is a relative insider unlikely to bring big fresh ideas. Outsiders haven't fared any better. It sounds like another financial engineering refrain.
Renren hardly looks worth huge premium to Facebook 3 May 2011 The Chinese social network's IPO aims to fetch twice the implied valuation of its larger unlisted U.S. peer. Yet Renren's revenue growth is slowing, its audit chief just quit and user numbers deserve scrutiny. That means Facebook should be worth more or Renren less.
Warner Music sale would only be an opening act 15 Apr 2011 For a company supposedly in a dying industry, the home to Bruno Mars and Metallica has attracted a surprising number of suitors, including for the troubled recording unit. But that's mainly because the finale waits in the wings, 10 years late: combining Warner with EMI.
Google antitrust deal sets stage for bigger fight 8 Apr 2011 Allowing the Internet giant to buy ITA Software, with a few restrictions, is a mere sideshow. Online travel is small beer compared to control of search and mobile operating systems. The multibilliondollar question still to be answered is whether Google is an abusive monopoly.
Expedia aims for (social) network effect 8 Apr 2011 The $6.8 bln online travel company plans to spin off its popular TripAdvisor site that allows tourists to share tips with each other. That should help it capitalize on the investing fever for online communities. But the flight and hotel booking sites left behind could suffer.
IPO hopefuls want to sit around OpenTable 7 Apr 2011 The backers of nearly every company to market with an Internet angle Zipcar, Pandora, Zillow are conjuring comparisons to the restaurant reservation site whose shares have quintupled since their debut. While similarities exist, none have OpenTable's moat or network effect.
Can Time Warner afford not to buy Netflix? 16 Mar 2011 With its plans to acquire a hot TV series starring Kevin Spacey, the $11.5 bln online video service is looking ever less like a website and more like Time Warner's valuable HBO cable network. For all Time Warner's trash talk about Netflix, it might just be better off owning it.
U.S. public radio needs new funding model 10 Mar 2011 Impolitic remarks by an NPR executive and a political push by Republicans have jeopardized the broadcaster's federal money. The government should support the arts but, all things considered, it may be time for a new approach. A $3 bln endowment could set a path to independence.
Facebook virtual currency starts to reap benefits 8 Mar 2011 The social network has to work hard to justify its valuation. Inserting itself as a financial middleman by offering Warner flicks online for Facebook Credits is a good start. While movies and games are a natural fit, it's far from becoming an Internet reserve currency.
Macau proves a risky bet for Las Vegas Sands 3 Mar 2011 The casino operator's value has dropped more than $2 bln over U.S. probes into corruption in China's gambling enclave. Macau's seedy side is no secret, but Sands, with its hopes of being welcomed in more genteel places like Spain and Singapore, has more to lose than most.