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IPOs Clanked in 2007

Craig Matsumoto
1/4/2008
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Technology IPOs seem back in vogue, but a look at the 2007 crop shows the market can still be a cruel mistress.

That's got to put some shaking in the knees of companies like ANDA Networks Inc. , Broadview Networks Holdings Inc. , Fabrinet Co. Ltd. (NYSE:FN) , and the newly formed Source Photonics Inc. -- all of which have active S-1 forms filed with the Securities and Exchange Commission (SEC) .

(See ANDA Files for $86M IPO, IPO Alert: Broadview Files Its S-1, IPO Alert: Fabrinet, and Source Photonics Files for IPO.)

As part of our look back at 2007, we've tallied the results of the year's telecom-related IPO disappointments. Consider it an adjunct to our reports on the stock market's ups and downs. (See 2007 Top Ten: Share Shrinkers and 2007 Top Ten: Stock Rockets.)

To be fair, some IPOs came up roses. Infinera Corp. (Nasdaq: INFN) couldn't be too unhappy about its debut, and Aruba Networks Inc. (Nasdaq: ARUN) and Starent Networks Corp. (Nasdaq: STAR) fared well. Indian firm Idea Cellular Ltd. also gave good returns, although its IPO price of 75 rupees translates to less than $2.

Table 1: Top Gaining IPOs, 2007

IPO price Dec. 31, 2007
closing
Gain
Starent (STAR) $12 $18.25 +52.1%
Aruba (ARUN) $11 $14.91 +35.5%
Intellon (ITLN) $6 $7.54 +25.7%
Entropic (ENTR) $6 $7.28 +21.3%
Infinera (INFN) $13 $14.84 +14.2%




We included Entropic Communications Inc. (Nasdaq: ENTR) and Intellon Corp. (Nasdaq: ITLN) there, even though both entered the public market in December, meaning they don't have much in the way of trading history. (See IPO Flatliners.)

A bigger proportion of IPOs delivered less happy news.

Table 2: Top Non-Gaining IPOs, 2007
IPO price Dec. 31, 2007
closing
Loss
BigBand (BBND) $13 $5.14 -60.5%
Towerstream (TWER) $7.75 $3.07 -60.4%
Limelight (LLNW) $15 $6.89 -54.1%
Clearwire (CLWR) $25 $13.71 -45.2%
Opnext (OPXT) $15 $8.85 -41%
Virgin Mobile (VM) $15 $8.89 -40.7%
Veraz (VRAZ) $8 $4.82 -39.75%
Airvana (AIRV) $7 $5.43 -22.4%
MetroPCS (PCS) $23 $19.45 -15.4%




Rather than use a countdown format, we'll start with the hardest-luck stories:

1. BigBand Networks Inc. (Nasdaq: BBND), down 60.5 percent. BigBand started hot, but its second-half earnings gave its shares a new direction. (See BigBand Looks to Resolve BigProblems, BigBand Terminates CMTS, and Creating a Silver Lining Among the Dark Clouds.) 2. Towerstream Corp. (Nasdaq: TWER), down 60.4 percent. Technically not an IPO, Towerstream made it to the Nasdaq from over-the-counter territory, with less than towering results. (See TowerStream Falls on $40M Share Offer.)

3. Limelight Networks Inc. (Nasdaq: LLNW), down 54 percent. CDNs are hot, but Limelight is still recovering from a summer swoon. (See Limelight's Dim Q2.)

4. Clearwire LLC (Nasdaq: CLWR), down 45 percent. WiMax just got no respect here. (See No. 2 and Clearwire's Bubble Bursts.)

5. Opnext Inc. (Nasdaq: OPXT), down 41 percent. For telecom photonics, public markets were tough all around. (See Optical Outlook.)

6. Virgin Mobile Telecoms Ltd. , down 41 percent. Virgin didn't raise the $506 million it hoped for, and it's been downhill in the three months since. (See Virgin Mobile USA Makes $412M in IPO.) 7. Veraz Networks Inc. (Nasdaq: VRAZ), down 40 percent. Investors got jittery from the start, in Veraz's case. (See Veraz Looks for Respect.) 8. Airvana Inc. , down 22 percent. One IPO that couldn't find nirvana. (See Airvana Makes $58M in IPO.)

9. MetroPCS Inc. (NYSE: PCS), down 15 percent. Those billboards with the screaming people? They make a little more sense now. (See MetroPCS Eyes $1B IPO.)

10. There is no No. 10, although Espial Group Inc. (down 53 percent on the Toronto exchange) would have fit, had we considered non-U.S. IPOs.

— Craig Matsumoto, West Coast Editor, Light Reading

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optiplayer
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optiplayer,
User Rank: Light Beer
12/5/2012 | 3:50:18 PM
re: IPOs Clanked in 2007
"...fleeced at $13..."

Anyone who purchased at $13 had 7 months to sell above $15/share and 4 full months to sell above $20/share (often well above $13). Boy would I love to be fleeced like that in most of my investments.

The secondary is a different story...caveat emptor!

Your passionate hatred for INFN is puzzling... come on, isn't it time to come clean on why?
Pete Baldwin
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Pete Baldwin,
User Rank: Light Beer
12/5/2012 | 3:50:18 PM
re: IPOs Clanked in 2007
Yeah, I thought of that after filing. It's a side effect of doing this by IPO price rather than first-trade price ... Infinera could easily have gone in the other list.
Stevery
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Stevery,
User Rank: Light Beer
12/5/2012 | 3:50:18 PM
re: IPOs Clanked in 2007
To be fair, some IPOs came up roses. Infinera Corp. couldn't be too unhappy about its debut,

unless you were one of the investors that they fleeced at $13, or worse at $22 in the secondary.

It's all a matter of perspective.
Pete Baldwin
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Pete Baldwin,
User Rank: Light Beer
12/5/2012 | 3:50:17 PM
re: IPOs Clanked in 2007
Didn't they IPO last year? The focus here was on midyear IPOs.
trzwuip
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trzwuip,
User Rank: Light Beer
12/5/2012 | 3:50:17 PM
re: IPOs Clanked in 2007
Where are they on the list? Down +32% this year in their first year.
howsweetitis
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howsweetitis,
User Rank: Light Beer
12/5/2012 | 3:50:16 PM
re: IPOs Clanked in 2007
got to love those .35 cent options. Sorry stevery you should have gotten a job at INFN and worked your ass off. howsweetitis!!!!!!!!!!!!!
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