Article Abstract:
Underwriters who are aggressively boosting the number and price of shares offered in initial public offerings (IPOs) are making new companies richer but exposing investors to considerable risks. Increasing the terms of IPOs theoretically helps firms capture more of pent-up demand for their offerings rather than allowing the IPO to skyrocket the first day. However, investors consider these increases as bullish signs and bid up the issues even more. CommScan analyst Kris Williams noted that this is causing more first-day IPO volatility and risk for investors who buy IPOs in the secondary market.
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Article Abstract:
Twenty startup companies are expected to launch their initial public offerings (IPOs) in the week of Apr 10, 2000, despite fears that the wild volatility in technology stock values during the week of Apr 3, 2000, could drive away investors. Analysts expect the first-day gains of most of these IPOs to cool until confidence is regained in technology stocks by investors, who are becoming more wary. Nuance Communications, Crown Media, DDi and Genomic Solutions are among the companies whose IPOs will be closely monitored during the week of Apr 10, 2000.
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Article Abstract:
CDNow, an online music retailer, has reported that sales for the 1999 Thanksgiving were up 200% from the previous year, but this could be due to an accounting anomaly. The retailer adds to revenue the value of coupons redeemed by customers, deviating from the standard accounting practice of subtracting the value of the coupon. Company CFO Joel Sussman has admitted to the practice but did not elaborate.
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