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Two e-commerce firms move toward public trading

In a sign that the market for e-commerce stocks may be rebounding, Garden.com priced its public offering today and business travel site GetThere.com filed for an IPO.

In a sign that the market for e-commerce stocks may be rebounding, Garden.com priced its public offering today and business travel site GetThere.com filed for an IPO.

Garden.com priced its IPO at $12, in the midpoint of the $11 to $13 range it set in July. The company said in previous regulatory filings that it plans to sell some 4.1 million shares of stock.

Meanwhile, GetThere.com filed today to raise up to $75 million in its public offering. The company did not specify the number of shares it would sell or set an offering price for them. Donaldson, Lufkin & Jenrette will lead the company's offering, in conjunction with Salomon Smith Barney; Bear, Stearns; and WR Hambrecht.

The moves come in the midst of a dearth of new e-commerce offerings on the public markets. In response to collapsing stock prices, Garden.com pulled its public offering last month, as did such firms as Ftd.com and Greatfood.com.

For year ended June 30, Garden.com lost $19 million on $5.4 million in revenue. The company has lost $26.9 million since it began operating in October 1995.

Formerly the Internet Travel Network, GetThere.com lost $20.3 million on $5.6 million in revenue during the six-month period that ended July 31. The company lost $15.6 million on $6.4 million in revenue during the year ended January 31. Through July 31, the company had a cumulative loss of some $45.9 million.

United Airlines owns some 33 percent of GetThere.com and American Express owns about 18 percent.

Garden.com and GetThere.com's financial figures don't look that much better than those of earlier e-commerce entrants into the public markets. But while those figures might have hurt their IPO prospects over the summer they might not be such a hindrance now.

After months of throwing money at seemingly any stock that had ".com" in its name, investors seemed to become much more skeptical of e-commerce stock offerings, and seemed to be paying more attention to losses. Despite growth in revenues and customers, e-commerce giants like Amazon.com and eBay saw their shares plummet to half of the highs they reached in April.

But E*Offering analyst Andrea Williams said the market now seems to be much more amenable to Net stocks. Not only do investors seem to be more optimistic about the market in general, but Internet companies are likely to get a boost as they move from the seasonally slow summertime to the fall and holiday seasons.

And as the market picks up for the public companies that are already trading, private companies like Garden.com and GetThere.com will be more likely to jump in, she said.

"It looks like the market is picking up and looks like it will be fairly solid for a little while here," Williams said.

In contrast to Williams' optimism about the market, Vernon Keenan of Keenan Vision said that the "party's over" for retail e-commerce stocks. Companies like CDNow are still depressed and despite their recent rebound, Amazon and eBay are still nowhere near their highs.

Pointing to PurchasePro.com's successful IPO earlier in the week, Keenan said that the market is starting to realize the potential of the business-to-business e-commerce market.

"When you think about creating a new exchange for a trillion dollar industry like chemicals, you get kind of excited," Keenan said. "If you just get a small percentage of those payments you will make more profits than even eBay has ever dreamed of."