graphic
Markets & Stocks
IPOs seek star quality
October 19, 1998: 10:02 a.m. ET

Desperate for a sure moneymaker, dry market looks to Conoco, Healtheon
graphic
graphic graphic
graphic
NEW YORK (CNNfn) - At a time when initial offerings are at a virtual standstill, the humdrum IPO market is desperate for a touch of star power, and two of this week's seven deals -- Conoco's gigantic $3.3 billion offering and Healtheon's famed Silicon Valley pedigree -- might just deliver that blockbuster.
    
Healtheon founder may pack buyers in

     Internet healthcare startup Healtheon brings the solid track record of cofounder James Clark to the selling block when it goes public Tuesday. Clark founded Silicon Graphics (SGI) in 1982 and co-founded Netscape Communications (NSCP) four years ago.
     However, even though Clark adds a bit of certainty to Healtheon's $40 million offering, some market watchers say demand isn't as strong as expected. As one trader said, "The market is not yet ready to reward marginal deals," and 2-year-old Healtheon, burdened by $73 million in debt and annual revenue of only $70 million, is one of those "marginal" calls.
     In its favor, the Santa Clara, Calif.-based company offers a cheaper alternative to existing healthcare information systems. By pushing the paperwork of doctors, hospitals, insurance providers, patients and labs onto the Internet, Healtheon already is competing with firms like IBM (IBM) and HBO & Co. (HBOC) for a share of a $250 million industry.
     So far, Healtheon has relied mainly on four customers, including United HealthCare (UNH) and SmithKline Beecham Clinical Laboratories (SBH), and some analysts believe the industry at large will be slow to adapt.
    
Petroleum giant takes a bow

     Conoco, the nation's eighth-largest oil company, accounts for practically all of the $3.4 billion expected to enter the IPO market this week. In the biggest U.S. offering ever, Morgan Stanley plans to raise $3.3 billion for 150 million Conoco shares.
     Unlike new or less-familiar companies, DuPont (DD) subsidiary Conoco will draw on decades of proven customer appeal when it starts trading Thursday.
     Wall Street is expected to absorb the entire initial offering and have an appetite for even more. According to one trader, "The deal isn't a flash in the pan."
    
Internet player also in repertory

     Traders with a taste for pure Internet deals may watch for theglobe.com's Tuesday offering. The company, which offers Web page building services and chat rooms, is expected to raise $37.2 million at a price of $11 to $13.
     If rival Web hosting company GeoCities (GCTY) is any guide, theglobe.com certainly will generate interest. GeoCities defied the odds when its IPO more than doubled on its first day of trading, closing at 37-5/16 after pricing at 17. Back to top
     -- by staff writer Bambi Francisco

  RELATED STORIES

DuPont sets Conoco IPO - Sept. 28, 1998

Goldman shelves IPO - Sept. 28, 1998

  RELATED SITES

IPO Monitor

IPO Spotlight

IPO.com


Note: Pages will open in a new browser window
External sites are not endorsed by CNNmoney




graphic

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.