Data Broadcasting Is Spinning a Web
Something is brewing at Data Broadcasting (DBCC), whose stock soared from 5 3/4 on Nov. 11 to 15 on Dec. 29. Is it Internet-related? Bet on it.
This stock, which had been lumbering along between 3 and 6 before heating up, is headed even higher, insist some pros who have made a bundle on Net issues. The reason, they say, is the prospect of a red-hot initial public offering--expected in late January--of MarketWatch.Com, a joint venture between Data Broadcasting and the broadcast arm of CBS. Data Broadcasting and CBS will each own 38% of MarketWatch.Com after the IPO.
The joint venture's Web site, called CBS MarketWatch.com, is designed to be a one-stop shop for all sorts of financial information. It currently provides breaking news, expert analyses, and market data. CBS will contribute $30 million worth of advertising time on its television and radio stations to promote the Web site. Data Broadcasting is a leading provider of real-time market data, financial and sports news, and gambling information to more than 2 million users--over PCs, FM radio, cable and satellite transmission, and the Internet.
Although the IPO is expected to be priced at $10 to $12 a share, some pros believe the stock will blast off after the opening--just like other recent IPOs of Internet outfits that serve robust niche markets.
''They expect MarketWatch.Com will be another uBid, the Internet auctioneer whose stock soared some 700% since it went public on Dec. 4 at 15 a share,'' says one fund manager who has loaded up on Data Broadcasting. Now trading at about 140, uBid was also a spin-off that was later taken public by its parent, Creative Computers. Since uBid went public, the parent's stock has also rocketed--from 6 to 60. ''Data Broadcasting shares are the way to play MarketWatch.Com before it goes public,'' says one New York investment banker.
BY GENE G. MARCIAL
Updated Dec. 30, 1998 by bwwebmaster
Copyright 1999, Bloomberg L.P.