BUSINESSWEEK ONLINE : AUGUST 7, 2000 ISSUE
BUSINESSWEEK INVESTOR -- INSIDE WALL STREET eFunds: An IPO Worth a Second Look? An example of a 2000 IPO that has headed nowhere but down is eFunds (EFDS), which went public on June 26 at 13. It is now at 9 1/2. No, eFunds isn't a no-revenue, no-earnings dot-com. A provider of payment-transaction processing and risk-management services, eFunds is expected to earn 23 cents a share in 2000 and 80 cents in 2001, up from 10 cents last year. And revenues are expected to total $411 million this year and $510 million next, up from 1999's $306.6 million. Among its customers: Citibank, Bank of America, Wells Fargo, Wal-Mart Stores, J.C. Penney, and Kmart. So why did the eFunds IPO bomb? ''It was largely bad timing: Investors were wary of new issues then,'' says Joel Krasner of First Albany. ''The company participates in the fastest-growing sector of the electronic payment industry,'' says Krasner, who rates the stock a ''strong buy,'' with a 12-month target of 18. Krasner says eFunds should become a leading facilitator of Web-based transactions. It is one of the big third-party processors of debit transactions at automated teller machines and point-of-sale terminals. He adds that eFunds will benefit particularly from the emerging use of electronic checks, direct-deposit and direct-payment transactions, and debit cards over the Web. By GENE G. MARCIAL _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP					RELATED ITEMS eFunds: An IPO Worth a Second Look? CHART: ``Bad Timing'' for a Launch INTERACT E-Mail to Business Week Online

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