Company sets flotation price range.
A large domain name company is getting ready to go public. Will you get in on the action?
Demand Media, which owns eNom, has set an expected price per share of $14-$16. It plans to sell 4.5 million shares while existing shareholders hope to offload 3 million shares.
The company also released preliminary, unaudited numbers for Q4 2010. In the last quarter of the year it grossed between $71.5 million and $73.5 million, a 31% increase over the same quarter in 2009. Demand Media credits the growth primarily to increased content revenue due to both more pageviews and a higher RPM. Increased domain name registrations also helped, but to a lesser extent.
So, do you plan to buy shares in Demand Media’s IPO?
Matt says
Looks overpriced.
“The IPO’s midpoint price would give Demand Media a market capitalization of $1.24 billion, or 5.19 times annualized sales of $179.4 million in the first nine months of 2010. That’s more than triple the average 1.45 times sales for 20 U.S.-traded multimedia companies, data compiled by Bloomberg show.”
Einstein says
Not in a million years. This Rosenblatt guy seems like a master of screwing gullible buyers. Not me
personal experience says
Why would I want to invest in a company that is loosing lots of money and has poor management?
John Humphrey says
For a variety of reasons but especially for how Rosenblatt handled .TV- showing such obvious disregard for the early adopters who paid premium prices- I wouldn’t touch it.
bystander says
If one is looking to take a risk,
they would be better off buying
a lottery ticket.
However, with a lottery ticket, at
least you have a chance of a
financial award (as slim as it is).
With Demand shares, the upside
potential is just as slim.
Especially, after the present
shareholders sellout at a huge profit,
leaving Wall St. and stockholders
holding the bag.
And, why buy the shares ignoring
the fact that Google could (and will)
eventually penalize Demand websites
and revenue.
All it will take is the financial press
(maybe a TV investigative show) asking
Google why is Demand getting a ‘pass’
with its content farm and misguiding/sending
Google searchers to these fabricated
websites.
If Google would ‘black ball’ Demand,
the shares would have the same value as
????
Bo says
Maybe when it drops to $1.00
Shaun says
No.
domain guy says
rosenblatt has a checked past but so did the ceo of vonage as long as its disclosed it will pass sec muster. the timing is good with facebook and twitter in the news,i predict the initial shares will be bought on the open market…but there is a problem with demand medias biz model.however this could be corrested in the future.i might take a few years to straighten out out this biz model.as is its a failure.
Adam says
ouchy
Hal Meyer says
Definitely not. I pulled all of my domains out of eNom years ago.
Steve M says
Sure; I’ll invest “in it.”
Once shorting the stock’s available.
Frank Schilling says
Nope, But I wish them well.
John Que says
If they say history repeats itself (Marchex stock drop, steady decline in PPC revenue, too much power in the hands of two main providers, banned generics and blacklisted domains), Demand’s odds of long-term success on the public market look pretty nil.
This isn’t exactly Groupon here.
However with all DM’s combined traffic, they could create a Groupon-type business (w/Groupon’s estimated $15-$25 billion IPO valuation) overnight.
What about their adult/porn domains with the enom whois privacy? Being on the market is going to bring much investigative research and put it heavily in the limelight.
One missed Q and your stock’s sinking 25% or more come morning.
Citibank shares look better to me.
My 3 Cents