Q&A With Ben Holmes, Jan. 31

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Ben Holmes hosted a Q&A session on

TheStreet.com's

Message Boards on Jan. 31. Here is the transcript of that event. As with all transcripts, the following text is unedited.

wammybear:

Kool...I get the first question.

Ben, any chance of you giving recomendations/outlooks/opinions/etc... on IPO's in the after-market?

You give opinions as to how an IPO will fare on its first trading day, but what about after that? Thanks

Ben Holmes:

What I do takes (almost) all of my time. I have two sons to raise and a lovely wife who I adore. Please don't give the editors at

TheStreet.com

any more ideas (grin).

fort_felker:

Ben - why would it be advantageous to participate in a secondary offering? Is there any reason to do this instead of simply buying stock in the open market?? Fort Felker

Ben Holmes:

First off you pay no commission and the deals often come at a discount to the previous day's close. If you're looking to own the stock, secondaries can be a great way to step in.

jforgosh:

Ben: What have been your observations to selling prior to lock-up expirations. There seems to be a signicant amount of selling pressure prior to the date. AND, are there ways to measure when many of the lockup shares have hit the markeplace? THANKS JF.

Ben Holmes:

There are no guarantees when selling or buying these deals prior to lock-up expiration. The tool is meant to flag the stock as potential trading candidates based on possible volatility. You really have to watch the stocks to get a feeling for which direction they are likely to go. Monitoring how many shares actually get sold is a full time job. I wish I had that kind of time.

rondu812:

Thoughts on World Wide fibers Upcoming IPO.Is ther any way of participating? Thank Ben. Ron Pallan.

Ben Holmes:

Just filed, I haven't had the time to read it yet. Check the site in a day or so.

tnmoneydr:

Ben, Great work on TSC. I know that lockups can keep insiders from selling. However, do lockups also keep insiders from buying? Thanks. TnMoneyDr Chattanooga, TN.

Ben Homes:

No, certainly not. Some insiders, based on how much stock they already own, must file with the SEC to disclose any buys they make. This applies to selling as well -- both during and after the lock-up period.selling as well -- both during and after the lock-up period.

16232:

Ben -- Does the sloppiness in the Nasdaq over the past couple of weeks affect the IPO market yet? It seems that, in spite of the sell-off, many new offerings (Avanex, Impsat, and Turnstone) have increased their price range. How sloppy does the market have to get before deals get pushed out or even cancelled? Are we close to that happening? Thanks, Burton Carlson.

Ben Holmes:

The IPO market just runs on its own clock. If the equity markets get really nasty the deals can be effected, but sometimes, like now, the IPOs just don't seem to care.

robert1975:

Ben Homes I was wondering which do you like is a better IPO to get into either Telaxis Communications or Centra Software? Thanks for your opinion.

Ben Holmes:

Two very different companies -- I like them both.

jforgosh:

Ben: Can you briefly elaborate on the best ways we might use and benefit from the services you offer? Thanks.

Ben Holmes:

I consider us

ipoPros.com

to be a sort of early warning system for those deals you should be involved in and those you should avoid. If you are seriously involved in the IPO market, or you want to be, you need a service like ours to do the grunt work like reading the filings and running down the timing info. Think of us as your own personal research dept.

rondu812:

Thoughts on World Wide fibers Upcoming IPO.Is ther any way of participating? Thank Ben. Ron Pallan.

Ben Holmes:

Just filed, I haven't had the time to read it yet. Check the site in a day or so.

firefire:

Ben you are a great addition to

TSC

. I am long out-of-the money April calls and out-of-the-money 2001 Leaps on COMS. How do you think the Palm spinoff with play out in terms of COMS' stock price in the runto the IPO, immediately thereafter, and right up to the actual distribution to COMS shareholders? Thanks Robert W. Elliott.

Ben Holmes:

Hard to say how it will play out for COMS. The Palm IPO is looking to be a huge performer. I'm thinking that a 3 digit stock price is a forgone conclusion. How high? 200, 300, 500, who knows?

gabby99:

Ben, what do you think of WorldQuest Networks. The company filed last year, i dont know the reason for the delay in coming to market, i hear it is now coming soon. appreciate your thoughts. thanks..gabby99.

Ben Holmes:

What's with the underwriters? Has anyone you know ever bought a deal from these guys? I certainly haven't. Stick to underwriters that you know. That rule is central to your survival.

fort_felker:

Ben - I have put in IOI's for several IPOs on Wit, but have not been selected for any shares yet. Do you have any idea what the percentage is of Wit investors who submit IOI's that actually get shares? Based on my experience it is pretty low.

Ben Holmes:

WIT is a pretty popular these days and it should be no surprise that people are getting shut out over there. Have you done any trades with them or are you just putting in for the deals? It would not surprise me if by doing a few trades with them you would be treated better than those accounts that offer no "love" to them.

Ralph Cahill:

Big fan of ya'lls Street.com and TV series. Now, how can I buy these IPO's before they soar to big dollars? I'm lost on this one. I do a lot of oil drilling deals so I'm a gambler. I like the risk vs. reward concept. But I just don't know the in's & out's of getting in the early stages of the IPO offering. Any help will be much appreciated. Ralph in Mississippi!

Ben Holmes:

I always answer this the same way: Find a broker who will work with you and give him or her as much business as you can. Be up front about what you want and just stick to it.

Ashish:

I was just reading your morning update and retreived your email address. I have a couple of questions, not necessarily having to do with the topic of your letter, but thought you would know the answers. I am wondering how one finds out when stocks are having their IPOs, and how (if possible at all) the average investor gets in on a stock at its IPO price? Also, did buy.com have their IPO this month? Please get back to me at your earliest convenience. Thanks.

Ben Holmes:

Buy.com is slated for the week of Feb 7. you can get a good calendar of upcoming IPOs on our website www.ipoPros.com

gillgome:

how do you consider dobson communication ipo?

Ben Holmes:

They have decent revenues and the market likes these deals. I like it for at least a few points.

j454545j:

Ben, could you offer a view/ review of European IPO market.....something in general? Thanks....I enjoy your stuff..jrock

Ben Holmes:

You may know that TheStreet.com has a UK bureau. We're working with them to build out a database of upcoming Euro IPOs. Not easy, but we love this kind of challenge. Look for that coverage in the near future.

j454545j:

Ben...Welcome to TSCM...Have or do you do any work calculating number of IPO's slated to go ..say 6 months out? Total market cap of those shares at offered price? I am trying to get a idea if there is enough money around to mop up those shares?...With all the lock-ups ending....the secondarys...and IPO's... this supply concerns me...

I understand Wit requires you to hold any IPO's you might get for a period of time...If this is true just who is selling those shares once they hit the street...

I recall your copy about how Wit, others use these IPO's as a hook..To get accounts...And i also agree the lead underwriters will cut them out at some point......Think it makes sense for GS to buy Wit? I understand they own a piece. And, it is my understanding GS does not work with the little guy....does not offer online accounts.

If the quality of the IPO's were to drop, would you consider that a sign of a market top? Does Rueter's offer opinion on IPO's or are they a newswire and that's it?

Cramer is a Rams fan...Think his wife had to hit him with stick last night? GREAT Game.. thanks....jrock

Ben Holmes:

I try to stay out of the statistics business -- how can anyone make money on that data? Supply is always a concern, but the IPO market handles that in a simple way. Too much, we shut down for a while. I'll be honest, I didn't even know that the Rams weren't still in Los Angeles until yesterday. When does Cramer have time to watch sports on TV? I can picture him with a big plate of nachos and a laptop cheering and writing TSC columns at the same time.

zomo97:

Ben: Have you heard anything about a possible upcoming IPO called Quorum (perhaps with a phonetic spelling)?? Greatly enjoy your IPO articles. Thanks. ZOMO Gary R. Graefe

Ben Holmes:

I don't know that deal.

ronaldbaruch:

Any opinion on Caminus?

Ben Holmes:

It looked better today. Priced at $16, not a barn burner, but it's working higher.

valjean:

Any thoughts on the AltaVista IPO? What is their model exactly? Search, portal? Are the B2B noises just fluff?

Ben Holmes:

Fluff or no fluff, I like that deal.

ijj:

Ben, What are yout thoughts on the Turnstone IPO this week? Will raising the offering price $7 take most of the premium out of the deal? Thanks.

Ben Holmes:

When I see a price range get jacked up like that I think DEMAND! Big revenues and just shy of break-even. Do you want bet against GS on a networking/technology IPO? I don't.

object:

Mr. Holmes, I just noticed Webmethods on the list for Feb 6th. What is your opinion? Thank you.

Ben Holmes:

Let's see: MSDW, B2B software -- I like it.

object:

Author: Appletree Mr. Holmes, I am also interested in your opinion of Avanex, Quantum Effect Devices and IMPSAT Fiber Networks IPOs. Since they are all offered in the same week, If I apply for all of them are my chances to be allocated shares any better than if I apply for only one? In other words, if I prefer, say, Avanex by far, but I would be happy to take Quantum or IMPSAT rather than none at all, should I apply for only Avanex or all three? Would the syndicate department be more likely to give me my top preference if I only applied for one? Also, I have already been given Freemarkets in an IPO, and I don't know if I should continue to hold it. What do you think?

Ben Holmes:

Hard to say what the syndicate departments care about lately. At least put in for Avenex and QEDI.

hmorgan:

Ben, I looked at IPOPros.com for info on the forthcoming secondary offering of Metricom and couldn't find any information.It's being handled by Lehman and other underwriters. Any information on this secondary's reception? I understand it will price after the close tomorrow.

Ben Holmes:

We're unclear on this deal. The filings seemed to have been lost within EDGAR.

mfallwell:

Ben Do you like either or both of Thermowave and/or Dobson Communications coming via Lehman this week? Thanks. Loginrythm

Ben Holmes:

I think Therma Wave is a FLAT deal, Dobson I like for a reasonable premium.

fatman5214:

MR.HOLMES I'd like your opinion on the PALM IPO and its effect on coms.THANK YOU

Ben Holmes:

I LOVE PALM!!! Do not be ashamed to beg for shares in this IPO.

belletti:

Mr. Holmes, What is your opinion on the following IPOs lead managed by Morgan Stanley: IMPSAT Fiber Networks, Quantum Effect Devices, and Avanex? Plus, as an individual investor, what is a reasonable number of shares to ask for? Thank you.

Ben Holmes:

Avanex and QEDI are hot. Ask for as much as you can afford.

dr. o:

Ben, Your thoughts on LNTY, please. Your column has been a great addition to TSCM. Fernando Obledo (no position.

Ben Holmes:

LNTY has been hanging in the low 20's. Not bad for a deal priced at $15.

general9:

Ben, You are the best. I love your columns. My question is that you like the mediacom comm. IPO in the price range of 15 to 19 dollars. I don't see how it can come out with much of a premium if Charter Communications CHTR the sixth largest cable company in the county, which issued an IPO a few months ago, is trading around $17.50. What are your thoughts. Thanks Marc long chrt.

Ben Holmes:

No, you are the best because you read my stuff! Compare those two deals and ask yourself this: 20 million shares vs. 170 million -- which is easier to run up?