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Martha Stewart, WWF IPOs
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October 17, 1999: 10:22 a.m. ET
Ready to rumble, or ready to decorate? Investors can have both
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NEW YORK (CNNfn) - Two of the most eagerly awaited IPOs of the year are scheduled to debut this week when Martha Stewart Living Omnimedia and the World Wrestling Federation sell shares to the public.
At first glance, the champion of tasteful home decorating and gracious entertaining has little in common with an outfit whose next pay-per-view event is called "No Mercy."
But similarities exist. For one, both Martha Stewart and the WWF have actual earnings. Martha Stewart Living Omnicom made $23 million on $180 million in revenue in 1998. The WWF earned $56 million on $251 million in revenue.
Further, while they appeal to vastly different groups, Martha Stewart Living and the WWF engender the kind of devotion most companies only dream of.
Martha Stewart
"They are the same type of company," said Tom Taulli, IPO analyst at internet.com. "They know how to market themselves and sell their product."
But despite solid positioning, both companies, analysts say, are riding a wave of popularity that could be tough to sustain.
"People could become tired of wrestling," Taulli said. While professional wrestling has been around for decades, its current boom, Taulli suggested, may amount to a fad.
Could Stewart outlast the WWF?
At 57, Martha Stewart the person is not likely to outlive Martha Stewart the company. But when it comes to sustainability, Taulli gave Martha Stewart Living Omnicom the edge over the WWF, at least in two out of three falls.
"If she were gone, I don't think it would be a big deal," Taulli said, citing Kentucky Fried Chicken's survival in the post Col. Sanders era.
Further, Martha Stewart has created an empire that includes a magazine, a cable television program, 25 how-to books, a syndicated newspaper column, radio show, Web site and numerous television guest appearances.
"Martha Stewart has been doing this for a long time," said Corey Ostman, chief technical officer at IPO Alert!. "I don't think it's a fad."
The WWF is hot
The WWF is no slouch either. It organizes approximately 200 live wrestling events each year in arenas throughout the world. The federation produces nine hours of television programming, 52 weeks per year, and 12 domestic pay-per-view events annually. It distributes programming and pay-per-view events in more than 150 countries in nine languages
"It has created the type of publicity that a good IPO needs," Ostman of IPO Alert! said.
Trading under the ticker symbol, "MSO," New York based Martha Stewart Living Omnicom plans to offer 7.2 million shares in the $13 to $15 price range. Morgan Stanley Dean Witter is lead underwriter.
Stamford, Conn.-based World Wrestling Federation, trading under the ticker symbol "WWFE," is offering 10 million shares in the $14 to $16 range. Bear Stearns is lead underwriter.
But Martha Stewart and the WWfF aren't the only IPOs ahead.
Analysts also like Sycamore Holdings, "SCMR," which plans to float 6.5 million shares in the $18 to $20 range. Chelmsoford, Mass.-based Sycamore, makes optical networking products. Morgan Stanley Dean Witter is lead underwriter.
And in the week's largest deal, Packaging Corporation of America, "PKG," plans to sell 42.8 million shares in the $16 to $19 price range.
The Lake Forest, Ill.-based company makes corrugated packaging products. Goldman Sachs is lead underwriter.
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