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Red Hat Software Businesses

Red Hat IPO Price Range Increase 165

Posted by CmdrTaco from the surprise-surprise-surprise dept.
saurus wrote in to tell us that an announcement has appearedon E*trade proclaiming that the IPO share price for Red Hat will now be $12-$14. Everyone's getting really anxious to see what happens. Brace yourself. Update: 08/11 12:32 by H : It looks like the info was pulled-anyone have more details? Post below.
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Red Hat IPO Price Range Increase More

Red Hat IPO Price Range Increase

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  • Is that the same company that used to make C-64 software? I thought they went belly up LONG ago...
  • careful there Rabbins. That Reuters clip is probably copywrited. Reuters gets touchy about people re-using their content w/out paying for it.

    werd.

  • It's cool like Java (buzzword compliant)

    Hmmm. Is java really buzzword compliant???? Find out for sure [sapien.net].
    :)

  • Its also worth mentioning, that it is entirely possible that you don't want cross-industry risk pooling if you have particular faith in the long term prospect of a given market.

    When you add your cash reserves, real estate, and all those Botocelli's (heh heh) in your basement, it may be possible that accepting higher risk in your stock portfolio may put your overall asset portfolio right where you want it on the return horizon. =)
  • This is NOT a good time to be an IPO.

    Be, Inc. is down to $6.00 - it's IPO price. It doesn't appear that it -can- fall any further, it's just been sliding along at the same price, for several days now.

    MP3.com's shares are still falling. I doubt they'll recover any time soon, it seems like a fairly terminal plunge to me, losing several dollars a day, every day.

    Other tech shares are either being postponed, are out this week after being postponed, or just doing miserably all round. From what I can gather, that is true (to some extent) of the stock market as a whole.

    If Red Hat does well this week, I would be amazed. Mind you, if it -DOES- do well this week, shareholders are likely to treat it like gold dust. If Red Hat can be one of the few tech stocks to buck the trend, expect to see them fly through the roof.

  • I don't think Be's price -can- drop any lower. On the charts, it shows Be's price diving, then suddenly flattening, as if it'd hit some kind of pre-set floor. Since then, it's been sliding along the floor, with the occasional blip up followed by a drop back. The earning report can show a loss of a trillion, and the share value wouldn't flinch. There's nowhere for it to go.
  • All I can say is I wish you luck, and luck to all the rest of the Red Hat investors. Personally, I think you'll need all the luck you can get, but then Red Hat might strike gold, too. That's just it - you don't know. But I do hope it goes well for you, for all my concerns.
  • BeOS is fast, stable, reliable, and has a prettier window manager than Windows. (But, then, so does the Commodore 64. :)

    Doesn't necessarily mean it's the best thing to invest in. Certainly, the current share prices are rock-bottom. I'd only invest in Be if: (a) they promoted their products, for a change, (b) at least one major manufacturer invested in it, and (c) we see at least one store with BeOS on the shelves.

  • I find it amusing that in E*Trade's list of upcoming IPO's,

    FTD.com
    Red Hat, Inc.
    Bamboo.com, Inc.
    Garden.com
    GreatFood.com, Inc.
    ImageX.com, Inc.

    , that RedHat is the only one without a ".com" in its name. Let's hope that the world is finally waking up to the fact that a .com address doesn't guarantee a company's success any more than does a Yellow Pages ad. I think that Red Hat has a good chance to be successful as a company, not just as a buzzword.

    As for the timing, it probably looked good when they started the IPO process, and I'm sure it's too late for them to back out now.
  • $ bc -l
    e(l(2) / 12)
    1.05946309435929526455 [12th root of 2]

    l() is natural log, e() is exponential.
  • Four of the reasons that you can't compete with Microsoft is that they are ruthless, effective, persistent, and have an unwavering devotion to the Pope.

    And if you don't believe me, we'll have to put you into... the Comfy Chair!
  • IANAFA (I Am Not A Financial Advisor), but my understanding is that this practice is derisively known as "flipping" and is a good way to guarantee that you will have a much more difficult time getting in on future IPOs.
  • Look to: http://www.etrade.com/cgi-bin/gx.cgi/AppLogic+IPON ews?INFOTYPE=IPO_MKTW_DAILY&IPONEWSHDR=+ IPO%20News+&IPONEWSIMG=ipo_cbsmktw.gif&IPOIMAGELIN K=http://cbs.marketwatch.com/news/newsro om.htx?dist=etrade
  • IANAFA (I Am Not A Financial Advisor), but my understanding is that this practice is derisively known as "flipping" and is a good way to guarantee that you will have a much more difficult time getting in on future IPOs.

    You're right that flipping is frowned upon, but it shouldn't be. You'd think there would be at least one person on Wall Street conversant with supply and demand...

    The "bubble" phenomenon you see with hot IPOs would be *reduced* if flipping was encouraged. For every single person who watches a stock's rise and tries to sell when that rise slows, their sale itself acts to brake the excessive rise of the stock price.

    If every IPO was aggressively watched by people waiting to dump their stock the moment it went up too unrealistically, well, it wouldn't go up unrealistically at all.
  • I didn't even get an alert. But again, thanks to /. and my paranoia, I didn't miss it. This kinda seems like yet another way ETrade is trying to screw everyone over. It's like it's policy.

    Gordon
  • you know that all the interest in RHAT are causing the price to increase... hope they do well, cause they'll be the benchmark for va and any other linux based systems/products that are gathering speed...
  • "utter chaos"

    That's that's an understatement:)
  • Agreed no one will retire... Figure you can get your hands on 1000 shares at the orginal low of $10. Lets say according to analyst 4 weeks ago (prior to the current sick wallstreet), RHAT goes up to $70 by day two.

    Ok you sell, you got $70,000, you pay etrade, and pay Uncle Sam %28 YES! in taxes.

    Only chance of anyone becoming a millionaire from RHAT is to invest early, continue to purchase stock as you can afford over the course of 4 or so years. During that time, bust your OpenSource coding ass:) to support them and their distribution. You gotta good chance.

    What I am waiting to see is a group of Open Source coders see an opportunity and just say "Hey RHAT, will bust our ass on projectX, totally opensource, all we ask for is nnnn shares of stock". If enough coders, with the right motivation ( $$$ + freecode = happyme ) could really make a fortune, retire early, and view pron newsgroups all day:)
    hehe..


  • For example, note this: "Extrinsic rewards can erode intrinsic interest. People who see themselves as working for money, approval or competitive success find their tasks less pleasurable, and therefore do not do them as well."

    Yea, I find that when I am solely motivated by the posibility of being extremely wealthy, my productivity decreases, I show up to work late, I refuse to service customers.. hell I'm just a total wreck.

    Sorry, just trying to ease the tension on this message board:)
  • It's a craps shoot, I signed up for about 2000, I could get em all, I could get 2, depends on how much etrade can fill my order.
    -Ben
  • RedHat is basically the commercial face of linux. right now in the suit world linux==RedHat.

    Be has such a low share of the OS market, and not a whole lot of people are talking about it, you hear more about Amiga these days than you do Be. Linux on the other hand, is everywhere, and that's good for RedHat.

    Of course, maybe I'm trying to convince myself I'm right, I got alot of money riding on this thing.
    -Ben
  • 18 to 20 bucks I'd say, if it goes above that, wait to buy it in 2 weeks.

    I'm just a geek, not the Amazing Creskin.
    -Ben
  • a) they can't until silence period is over b) Intel is investing in it (sounds major to me huh? c) J&R music/computer world here in NY has BeOS on its shelves
  • well if MS is competing with redhat and redhat doesn't fight back, they'll lose. Remember, redhat is a public company so it's important what they do-not what Linus says
  • I submitted the following to Ask Slashdot earlier today but it probably won't appear
    "Should RedHat cancel or postpone their IPO? IPO's in general and "internet related" (in the thinking of the general public) IPO's in
    particular aren't doing as well as hoped in the past few days. If RedHat pulled their IPO and conducted a private sale just to those who got "the e-mail", could they get $15 or so per share, stockholders who would be more sympathetic with company goals that don't wring out every last penny in possible short term profits at the expense of Linux and Open Source, and an incredibly enthusistic response from people who
    understand the product and the market that they could point to later on in talking with the general financial community who think that computers have pushbutton cupholders?"
    I still think it's a good idea for them to be careful who they sell to.
    Another possible Linux-related stock buy could be Corel. They were on CNBC today talking about a Corel Linux distro with a "Windows-like" desktop. It's explained better on their website --linux.corel.com -- but they were talking for the general public in the TV interview. This could mean come the Xmas '99 shopping season a bunch of e-Machines down at circuit city running Word Perfect and 'net surfing software on a user-friendly looking desktop with Linux underneath, selling cheaper than the iMacs and the Windows machines. World domination may be in Santa's sack.

  • "Now this?" Um... I'm not certain that an initial price increase is a good thing even for people who got "the letter" - sure, maybe it means that there's more hype, but it also means that even those who got "the letter" have to pay 20% more for each share to take advantage of the offer...
  • Damn, wish I had $30 grand to gamble on Red Hat. I was thinking... even if it goes up fivefold, I still can't retire. :-)
  • I did a bit of research, and for the past couple months, all the IPOs I checked on opened very close to their maximum expected offer price. The worst case was a spread of $5: max expected $25, opened at $30. Then there was one at $-7 ;-)

    I'm not too worried about the price being significantly different than the expected range, nevertheless I've set a max price on my indication at $20, since I've only got $10K in that account. I did suddenly realize that I need to lower the share count frmo 500 to 498 so I can cover the commission.... D'oh. Not quite prepared/able to sell my SQNT stock (stupid forms) yet, and I'm not sure I want to. SQNT turns into IBM soon ;-)
  • WARNING! E*Trade is playing one last trick. If the stock prices outside of the "original $10-$12 range", everyone is being forced to re-sumbit their conditional order. That means you may have as little as, say, 30min (never more than 2hrs, so say the critters at E*Trade) to actually call them and re-submit it.

    ELSE YOU DON'T GET YOUR STOCK!

    The Slashdot people seem to be completely dropping the numerous e-mails I've been sending them, which is why I'm posting a comment here, in case anyone is still reading this. Hopefully it will show on the main page soon. If you see this, poke at the Slashdot guys so we can get this info on the front page ASAP!
  • What?

    There are chances like this everyday. RedHat is just another run of the mill decent IPO. The problem is that so many of the current group of IPOs (last 6 months are so) are garbage. Short selling won't win you any friends either at any of the online brokers. They will all block you from further IPOs.

    ---
    Openstep/NeXTSTEP/Solaris/FreeBSD/Linux/ultrix/OSF /...
  • One important thing to know: if the number of stock holders in a corporation exceeds some magic amount, then (apparently) the company automatically becomes public. This basically robs the company of any IPO opportunity, which is why companies simply cannot afford to let this happen.
  • P.S. I have a little extra in there to cover any commission, but it is my understanding that there is no commision on an IPO. Is this true?

    No, this is definitely not true. As far as I know, E*TRADE charge standard commission ($20.03 with SEC tax) on IPO sales.

  • Buy on the IPO day and watch the price. It should shoot up dramatically.

    Keep hitting reload on the stock price. Make sure you are on a realtime quote site, not a 20 minutes delayed site.

    Watch for the top of the curve. It should happen pretty soon after the stock starts trading, maybe within a couple hours. Once you see the top of the curve, sell everything you have.

    Then, wait two weeks and buy as many shares back as you can.

    Even if you don't get in on the bottom price you might be able to make 20% on the first day of trading. After the first day, the stock price will fall a lot, but after a couple weeks it might start climbing again.

    If you lose money doing this, don't blame me, I heard it somewhere else and I have no idea how it will work.

  • You should be able to buy in time to make about 20% on the first day. I've watched IPO's happen realtime, and that's what it usually comes down to.

    It's true that you will get in late and close to the top, but if the stock has good momentum it will go up a bit more. You really need to watch closely though.

    I haven't done this with real money though, so your mileage may vary.
  • Look, you and I know that Red Hat isn't substantially different from other Linux companies -- but the market is driven by mania first and reason second. If everyone thinks Amalgamated Dog Poop is hot, by definition it is.

    Ever hear of Tulipmania?

    --Tom


  • untested and risky from the point of view of fund managers, and brokers

    None of these "dot com" IPOs and, now stocks, are a good long-term investment. Fund managers wouldn't touch them with a 10-foot bargepole. Why? Because the vast majority of these companies are loss-making. Not only that, but, in many cases, only a very small percentage of the company's equity has actually been sold off to the general public. Does anyone know what percentage of Red Hat is being placed by this IPO?

    The only reason that shares like this are popular is because "day traders" want to buy them, wait until the price rises, and then sell at a profit. They're not interested in the long-term investment.

    Now, playing the market in this fashion is all very well. Many people have made millions from it, and not just on the stock market either - here in London, the London International financial Futures Exchange is a place where "locals" or "red coats" (people who trade with their own money, instead of on behalf of a company) have made millions buying and selling futures and contracts in open outcry.

    However, it's ultimately self-defeating, because the only reason share in .com's are worth what they're traded at, is because individuals place that value upon them. There's nothing to actually back it up - no profits, little in the way of assets, etc.

    Because of that false value, and because that value is created by individual investors (i.e. the "general public", rather than people who actually know the markets) the risk of a major crash is huge. It's basically a kind of a vicious circle, although a house of cards would be a better description. You plan to buy shares as soon as they come on the market, because you expect them to rise in value. But the reason they're going to rise in value is because there are thousands of other people out there who are thinking exactly the same thing.

    The parallels between what's happening at the moment and what happened back in 1929 are huge. All it will take is a loss of confidence for you and all the other people like you to decide to get out of the market, and start dumping the stocks you hold, at which point the prices go through the floor.

    Luckily, the recent correction has vastly reduced the risk of a 1929-style Crash, but the risk is still there.

    To anyone who is thinking of getting into this whole thing of playing the market, I would give the following advice -

    Only invest money that you can afford to lose.

    Why? Because what you're doing isn't investing - it's gambling.

    D.
    ..is for Dangerous.

  • I won't be surprized if at the end of the first day of trading it's in the $80-100 range. Damn, wish I had got one of those golden letters of joy.

    "The voices in my head say crazy things"

  • No offense, but at this point, the rule that I tend to follow is this: take what E*Trade tells you, and believe the exact opposite.
    --

  • DO NOT BUY on the day of the IPO... Only if you have the "letter" should you own any shares that day. If you're buying through an online brokerage, you're not going to be able to get the shares until they've already hit their peak. At which point you can just watch them plumet as the market floods with shares from everyone cashing in. If you must buy it, wait a few weeks, and it'll have stabilized...
  • You can watch them rise, but actually buy them? No. You've got to be on the trading floor in order to get them as they're coming out...

    The day EBAY went public, i put in a buy order at exactly 9:15AM... it went through around 3pm at ___ (I forgot the amount, but basically, it's peak for the day). The next week was hard, in that it dropped and didn't make up the value for at least 10 days...

    So if you want to wait for (any) IPO to bounce back up, fine, but then you've got BE, MP3.com barely breaking even (if not being below their IPO price) after 2 weeks, countless others that never quite resurface.

    All you hear about in the news are the IPO's that skyrocket. There's also quite a few that tank. Redhat probably won't be one of them because there's so much demand from the user community, most of whom *WILL* try to buy it the moment they go public.

    The way the markets been going recently (down!) I wouldn't be suprised if RHAT and whomever else plans to go public postpone their decisions.
  • He's not talking about flipping. He's talking about open-market purchases on the first day. Read his first sentence: "Buy on the IPO day."

    I do agree with you about flipping, if you flip, e*trade will not want to do any more IPO business with you. Consider that VA Linux, Caldera, and Linuxcare are all talking about going public. So I'm not flipping mine!
  • I just called -- e*trade hasn't allocated shares yet, and in fact I was able to increase the size of my Conditional Offer.

    So I'm surprised that yours are allocated. The ways of IPO's are mysterious indeed.

  • me too (Score:1)

    by mec ( 14700 )
    I received the same alert, same time stamp, 10:09:23.

    I'm curious about the alert. It doesn't mention that Red Hat already bumped the price once.
  • Those of you who understand will forgive me.
    Well, I do, and yet:

    I've put more than a year of full-time, 50-a-hour-a-week development time into an open source project. And it's not even done yet.

    This isn't an "I'm entitled" argument. Rather, if I do get a Red Hat windfall, I'm using it to pay my rent while I put some more man-months into my project.

    Also, it is definitely not a "zero-sum game". Red Hat totally fits the model of a company that needs capital to expand. As a by-product of raising money, they have to leave some money on the table. They are offering us a chance to collect some of the money on the table. It's a very positive-sum game.
  • ... at the IPO phone number, 1-888-707-8680 ext 4263. Don't bother with the main IPO phone number.

    The first time, I talked to a helpful man who transferred me to a very helpful rep who modified my limit order to $14.25 for me. I asked the rep if Red Hat as likely to change the price again, and he said "probably not". Keep in mind that Red Hat, not e*trade, determines this price.

    The second time, I realized I had more $$$ in my account and I could actually buy 100 more shares. So I called again, and this time e*trade's rep told me that their computers were currently unavailable, and he would call me back when he could revise the order.

    I opened every conversation by stating that I was in Red Hat's Directed Share Program, and I always used the special 6-character account number (the one I get on http://www.etrade.com/redhatipo [etrade.com] after I log in).

    Anyone who has a limit order in for less than $14, you might want to call e*trade and revise it.
  • It would suck if it prices above 15, because that's all I can afford. I got past the IOI on E*Trade, so I am in the running for shares, but I only have enough in my account for 100 shares at $15 or less.

    COME ON RHAT! UNDER 15 PLEASE!

    P.S. I have a little extra in there to cover any commission, but it is my understanding that there is no commision on an IPO. Is this true?
  • I apologize if this has been said a kazillion times already; I have not read any of the 'Linux IPO' stories here. I simply want to express my humble opinion. You're perfectly entitled to yours if you disagree with it.

    Have you read the essay on the GNU web site entitled, "Studies Find Reward Often No Motivator?" If not, perhaps you should, particularly if you're one of those individuals who has expressed concern over the fate of the "Linux community" because of the mixture of grass-roots hackers and for-profit businesses.

    For example, note this: "Extrinsic rewards can erode intrinsic interest. People who see themselves as working for money, approval or competitive success find their tasks less pleasurable, and therefore do not do them as well."

    I find this an interesting qualifier to many of the views espoused by Eric Raymond. I'm sorry, but I think that the Slashdot guys have been spending too much time with the guys in Mountain View and not enough time with the spirit of Berkeley. The minute those dollar signs appear in your eyes, you begin to lose your vision.

    hackito ergo sum

  • The shares aren't going to be allocated until it prices. It hasn't priced, so you're shares are not allocated. They probably told you they had your indication of interest for 200.

  • Re:Cool! (Score:1)

    by tap ( 18562 )
    The announcements seemed pretty clear that the 800k was for employees, friends, family (the normal groups) and also community members (the unusual thing). Most likely, the employees will get some limit based on how long they've been with the company, 200, 400, etc., and they will get preference before community members. Wouldn't be very fair if Alan Cox got 0 and some guy who summited a incorrect bug report to redhat's bugzilla got 100, would it?

    Of the shares that end up with community members, if there is not enough to give everyone 100, some people will get 100 and some will get 0. The chances of anyone except employees getting more than 100 are about zilch. Only way would be if far fewer people than redhat anticipated took advantage of "the letter".

    No one will get 2 or 498 as some people seem to think, everything is done in blocks of 100. Just like how ATM cells are 43 bytes, no more, no less.
  • I just got off the phone with etrade (unsuccessfully trying to re-assert my 'indication of interest'). According to them, they re-opened the indication process at a bit after 10 AM, and closed it a bit after 11 AM. He said it was open just a bit less than an HOUR.

    This does screw over those of us who have lives (and jobs!) who don't camp out at Etrade waiting for these things to happen.

    "I'm sorry sir, there's nothing that can be done about it now unless you're part of the friends and family [sic] program" At least the RedHat chosen still get to play.

    I'm miffed....
    -Bill
  • This has nothing to do with whether this is a good time for IPOs. This has to do with the fact neither one of those companies is making any money nor has prospects of doing so in the future.
  • I just called E*TRADE's Red Hat IPO number and was told I'd been allocated my entire request--200 shares at offering price.

    I'm thinking (hoping!) that the increase in the offering price range is due to high demand.

    -- R.
  • Last night, E*TRADE posted the following:

    8/10/99 Please note, should the Red Hat IPO price above or below the original filing range of $10-12/share, E*TRADE customers will be required to submit a NEW Conditional Offer for shares. This offering has not yet been priced or declared effective. In the event that this happens, E*TRADE will update the IPO Bulletin and send an account alert to Customers who previously placed conditional Offers in this IPO.

    Then just now, this appeared:

    8/11/99 E*TRADE is now accepting new Conditional Offers in the Red Hat IPO. This issue has been priced at $14 and has been declared effective.

    That's followed by a link to the Red Hat directed shares page. You have to fill out a new qualification questionnaire (previous answers are provided as defaults) and a new conditional offer. Entering a limit offer less than $14/share is probably not a good idea. :-)

    Can anyone explain why E*TRADE is requiring new conditional offers?

    -- R.

  • I'm certain of what they told me. I'm also (almost) certain at this point that what they told me was wrong. Oh, well.

    -- R.
  • You think that open source software is where the future is heading, right? Put your money where your mouth is and buy shares in rhat, beos...

    I was under the impression that BeOS is NOT open. It's cool like Java (buzzword compliant) not Linux (free software).
    ---
    Put Hemos through English 101!
    "An armed society is a polite society" -- Robert Heinlein
  • I've learned from history and am not doomed to repeat the same mistakes.

    Actually I think you'll find that quite a few companies that seemed as solid as Microsoft have eventually failed for one reason or another( The problem with making unspecific historical generalities is that history covers an awful lot of data ;) ), While I don't think RedHat is a strong competitor yet, I see no reason for them to die anytime soon, and the longer they live the better there chances.
  • anyone recommend/share any limits on when its price too expensive to buy?
  • They really aren't the benchmark for va and other linux based systems. The common ground is linux that is true, but a RHAT has a much more "off the wall" business model, one that is untested and risky from the point of view of fund managers, and brokers (the main people who buys stocks). While it is much easier for a person with traditional business background to see how va makes their money, it is much harder to see in the case of RHAT. That is what separates the two IPOs and why you can't say they will be the benchmark for the rest of the Linux IPOs. I hope they do well (and I think they will). I didn't get the letter, but I'm gonna try to get in just after the bell :)

  • Sorry, I didn't ask specifically about the designated shares, as I didn't get The Letter.

    I'd hope there's a separate allocation procedure for "friends/family" -- that none of the designated shares go to other E*Trade customers unless "friends/family" don't collectively put in for at least 800,000. (I say that even though it decreases my own chances of getting in.)

    Note, however, that "friends/family" also includes Red Hat people, who presumably wouldn't have to go through E*Trade to get in. Unclear how many designated shares actually will go through E*Trade. From the SEC filing:

    At the request of Red Hat, the underwriters have reserved up to 800,000 shares of common stock for sale at the initial public offering price through a directed share program, to directors, officers and employees of Red Hat and to open source software developers and other persons that Red Hat believes have contributed to the success of the open source software community and the growth of Red Hat.

  • now posted at the E*Trade IPO Center [etrade.com]

    IPO Bulletin

    8/10/99 Please note, should the Red Hat IPO price above or below the original filing range of $10-12/share, E*TRADE customers will be required to submit a NEW Conditional Offer for shares. This offering has not yet been priced or declared effective. In the event that this happens, E*TRADE will update the IPO Bulletin and send an account alert to Customers who previously placed conditional Offers in this IPO.

    E*Trade's account/trading services were down for a while today. If RHAT prices outside the range, expect utter chaos. Oy.

    And no, the announcement doesn't distinguish between friends/family and others.

  • the alert I received in my E*T account is worded a little differently from what they posted on the IPO Center page -- "re-confirm interest" rather than submit new Conditional Offer.


    Subject: Red Hat IPO Update



    Please note, should the Red Hat IPO price above or below the original filing
    range of $10-12/share, customers will be required to re-confirm interest in
    the offering at the offering price. If this happens E*TRADE will send you
    instructions on how to re-confirm interest.


    This offering has not yet been priced or declared effective. E*TRADE will
    update the IPO Bulletin and send an account alert with instructions in the
    event that this happens.


    Not sure why I should have to re-confirm if I placed a limit order higher than the offering price. OTOH, if it prices at $0.25 higher than my stated limit I'd like the opportunity to still get in.


    Wednesday will have to be an international holiday for all us wannabe capitalist pigdogs to be able to deal with this.

  • the /. people are probably hung over after spending last night supping at the trough with Linus et al.

    plus it's 3 hrs earlier out there

  • time to refile conditional offers

  • IPO Bulletin

    8/11/99 E*TRADE is now accepting new Conditional Offers in the Red Hat IPO. This issue has been priced at $14 and has been declared effective. Go Now.

  • Oh yeah, it would be GREAT publicity for the open source community if someone cracked the E*Trade IPO pages. Dumbass.

  • hmm, good thing I kept reloading the IPO Center page and didn't rely on my "Alert inbox" for notification of need to refile conditional offer ... the timeout on the alert:

    August 11, 1999 10:48:01 AM ET

    [snip]

    E*TRADE is now, for a limited time, accepting new Conditional Offers for Red Hat IPO shares at the E*TRADE IPO Center.

    Yeah, limited time, like TOO LATE.

    Why do I suspect a LOT of people are gonna be REALLY pissed?

  • Philosophical arguments aside, it seems pretty unlikely that any of us mere mortals (i.e. E*Traders) will be going into early retirement off the RHAT IPO tomorrow, even if the stock comes out like gangbusters.

    A broker at E*Trade just explained the allocation procedure to me:

    First, assuming you made it past the qualification questionnaire and put in a conditional offer, E*Trade reviews you for eligibility, namely that you have enough money in your account to cover however many shares you say you want.

    Then E*Trade allocates 100 shares to everyone who's eligible -- if E*Trade has enough to go around. If not, the allocation is done randomly, i.e. lottery.

    If there happen to be shares left over after the first round of allocations, the process is repeated until the shares are gone. But this broker says "it's very rare" that there are enough shares to give even 100 to everyone who wants some.

    IOW, no matter how many shares you put in for, if you get 100 shares you'd be lucky.

    I'd note that this comports with E*Trade's stated philosophy of getting IPO shares into the hands of as many desiring E*Trade customers as possible over time. It also comports with E*Trade's need to make as many $19.95 commissions as possible in any deal.

  • >I would sell mine initially.

    I would suggest that this is not in the best interest of the investor, RedHat or the "Linux/GNU/OpenSource/whatever" community.

    1) If you are one of the lucky few who get in on the IPO, you would really be doing yourself a disservice to dump it on the first day since the immediate money you could make is far less than the potential return 10 years down the road if it takes off. Imagine how you will feel in 10 years if the value is 10x what you paid tomorrow and you sold it on the first day for a 20% gain.

    2) If anyone really cares about success of this IPO, 'flipping' is not how you help. Buying the shares and watching the price and then buying some more later is good. Dumping your stock the day you buy it does not contribute to the stability of the stock. RedHat and E-Trade want the stock to appreciate in value gradually over time, not swing windly up then crash to the floor.

    3) Instability in the market for open-source company IPO's will not help the compaines like VA that will go public in the future. If RedHat looks like a nightmare, the terms for future IPO could be less favorable.

    I am not a financial advisor, nor am I a wildly successful day-trader. These are my opinions. Sure, I'd like to make a quick buck as much as anybody. I'd like to make a lot more bucks over the long-haul and see the companies I like become successful in the industry, which - like it or not - sometimes depends on their track record in the market.
  • If you have an existing conditional offer in the RHAT directed shares program (i.e. you got the letter), you can still re-confirm interest, at least as of 11:00 Eastern Time. You will have to get a "broker" on the phone who will take the re-confirmation manually. I was on hold for about 15 minutes. If you were not part of the directed shares arrangement, you are SOL at this point.

    Mike

  • Absolutely.

    Add to that (or to summarize):

    1. Buy for the long term.

    2. Buy what you know.
  • If there is a high demand for shares the IPO price will inflate prematurly with correspondance to the high demand.. then will dive by the end .. up short down in a day || at most two-> time to buy
  • The poor performance of IPO's in the market recently might make this a good time for Redhat's IPO, from the investors' standpoint, inluding IPO buyers, and investors in the secondary market. If it opens lower, because of market performance, that just leaves more room for profit when it inevitably shoots up. There is a *lot* of interest in the redhat stock. Everyone from HP to SGI to IBM is supporting linux, and thus supporting redhat, indirectly, if not directly. Get in while you can. This timing might be your chance to catch it at a temporarily lower price.

    -Larry

  • IPO (Score:1)

    by zanzar ( 33471 )
    A friend of mine is playing with the redhat stock...Got accepted by etrade for the IPO...I hope he makes a nice hefty profit, so he can put a nice chunk into VA Linux System's IPO, a few months from now. VA is waiting to see what happens to redhat. Expect to see the IPO announcement in the next week or two, if redhat does well. You can quote me on this.
  • Hey, I submitted this earlier today. Stupid lousy rotten luck.
  • I got an alert at 10:09PM which said that a new pricing plan would require a new indication of interest.
    -russ
  • *Any* time I freely exchange something with someone else, that is not zero-sum, because we both value the other thing higher. Even if I change a $1 bill for four quarters, that is not zero-sum. Why? Because I wouldn't have bothered unless I valued the four quarters more than a $1 bill.

    Does it take time and effort to track the IPO? Yes. It's not free money; it cost me time to write the free software in the first place, and it's costing me time to buy the stock. Oh well, I've decided that it's still a better return per hour than the time I spend programming.
    -russ
  • at least you got first post ;)
  • So did I.

    Last post!

  • It's the top-rated one according to Red Herring. So everyone's watching.

    Hey, if more people bail from the IPO, then I can get more shares! C'mon, people, I need 4000 shares - that's just 40 of you ...

  • However, first they will fill up the first 100 shares of all those who stay in >bail,bailplease,please - so everyone has the same chance of getting 100 shares, but a lesser chance of getting more.

    And if you don't have enough cash for the first 100 shares, you're bumped. Hope you've got $1430 in your account ...

  • Of course, you probably won't get another IPO, but you're a coder, so who cares? And friends and family don't play by the rules anyway.

    Part of this is that the IPO allows people to provide supply for trading. You don't want the spread between bid and ask to get too big, or it superheats. As a seller, you want the spread to get to bid, but for efficient market forces, you need a roughly equal supply of buyers and sellers.

    Since the institutionals will bleed it off in tiny dribbles, in some ways you're helping out by selling at your own prices.

    Just don't try to do a limit buy the first day, it probably won't execute.

  • I just did, to see if my order for 4000 shares was still ok at the higher price range of $12-$14 and was told they'll just reduce the amount of shares up to the money market amount. But it's a good idea to phone, especially if you put in a limit.

    If you don't have enough in your account in a few hours, oops. Hope for a $12 pricing.

    Now I need to see how many we get on the family trust account (not through E*Trade) ...

  • Excellent! That means I've got a shot at my full allocation of 4000.

  • MSFT is competing with Linux, but, as Linus said in the interview (posted today on Upside), we define the battlefield. Float like a bee, sting like a horde of butterflies ...

    OTOH, MSFT will make money for the next 2-3 years, guaranteed.

  • I had to go through the standard IPO route myself.
    I was told they should show up tomorrow, before Noon PST (3PM EST).

  • Yup, me too.

    But then I phoned them and talked to a broker.

    No messages since then.

  • Exactly. By selling, you capitalize the earned wealth as income. And pay capital gains. Which goes to Black\\\\\Fixing Ops\\\Roads and paying off the national debt.

    Look, you could live in almost any other country and you'd pay higher taxes, so don't complain. If you don't want to be taxed, don't realize your increased wealth.

  • I called them quite a bit more than that ... they were having problems letting me into the directed shares ("friends'n'family") program, I finally had to do it via broker. (And I sure hope it worked, I'd like those shares at the IPO pricing, like my offer letter and financials support!!!!)

    All last week I was hearing "$12-$14" from E*TRADE. For what it's worth. This shouldn't really be news.

    - Jojo

  • Of course, everyone has been paying more attention to RedHat, and ignoring the other IPOs (who are they, anyways?). They may soar then plumment, but they hopefully won't drop like a brick, then forever sink....
  • Wow. I think the one that has really gotten people's attention is RedHat.

    (either that or it's just me)
    And hotjobs.com? Didn't they JUST start up a little while ago (just before the superbowl? or are they not that new?)
  • "Better yet, make periodic investments in two or three stock-based mutual funds, at least until you have a portfolio of at least $100K. You really can't get adequate diversification buying single stocks if you only have a few thousand dollars to invest."

    Well, I can't speak for everyone, but I put $3000 in an ETrade account 2 years ago, and now it's sitting at around $12k, but briefly hit $17k. Over the same period of time, I put $10k in mutual funds, and they are now sitting at $11k. Maybe I'm just crappy at picking mutual funds...

    Mike
  • Don't think of the stock market as a place where experts decide the appropriate price for stocks. Think of it as more like Family Feud, as in "Name the 7 continents--top 10 answers on the board!" You have to figure out what some fucking idiot thinks is a continent. Arctica? The stock market is more like a place where people with money try to outguess other people's moves, however stupid, and beat them to it. Few of these people know what slashdot readers know about Linux, open source, etc.

    Internet stocks are slumping right now, because that's the buzz that's going around the lemming herd of stock brokers. For now. Next month Tom Cruise will be wearing a red hat on Entertainment Tonight, and everyone will run out and buy rhat shares, or Bill Clinton will be overheard talking about open sores on his privates, and someone will think that he is holding open source stock in his private portfolio, and away we go!

    You're smarter than average, right? You think that Red Hat is a good company, right? You think that open source software is where the future is heading, right? Put your money where your mouth is and buy shares in rhat, beos, etc., then hold onto them until you retire. I'm 29 years old, so the worst case scenario for me is retiring in 36 years. Just about every stock is going up sometime in the next 36 years, so I'm picking cool ones. What about you?
  • grr... making us honest [lazy] pay more. oh well, c'est la vie.
  • As someone else here said, in the minds of many suits, "Red Hat" == "Linux". Those are the guys that drive the price.

    Now if only I could take advantage of this. [sigh]
  • "Goldman Sachs expected to price the IPO on Tuesday, but it said late in the day that it'll likely price on Wednesday pending a routine review by the Securities and Exchange Commission. A Goldman spokeswoman said the stock is still expected to trade on Wednesday."

    Read it all at: MarketWatch [marketwatch.com]

  • There are over 40 IPO's slated to come out this week alone. There were 30 last week. Many analysts have ventured that this huge slur of initial and public offerings is partly to blame for the recent poor performance of internet (which leads to tech, which leads to the rest of the market) stocks.

    I think this is a bad time for Redhat to be coming out... they are going to be (unfairly) grouped with all the countless "dot" coms that are coming, and I am afraid it may fair poorly.

  • You really can't get
    adequate diversification buying single stocks if you only have a few thousand dollars to invest.

    I would argue that you can. Many companies are like mutual funds in themselves. Take companies like Clorox, Procter & Gamble, Philip Morris, Coca Cola, Disney, G.E., IBM and AT&T.

    The amount of diversification within these companies is staggering... plus, the majority of them have huge operations overseas, meaning you get the benefits of a foreign fund as well!

    For instance, everyone knows Philip Morris makes cigarretes (which include Marlboro, Benson & Hedges, Virginia Slims, Merit, Parliament, L&M, Chesterfield, Lark and Basic to name a few), but did you also know that Philip Morris owns:

    Coffees (Maxim, Maxwell House, Sanka, and various Starbucks brands)

    Soft Drinks (Capri Sun, Country Time, Chrystal Lite, Kool-Aid and Tang)

    Post Cereals

    Condiments & Sauces (such as Bull's Eye Barbecue and Miracle Whip)

    Altoids, Jell-O, Shake N' Bake, Minute Rice, Toblerone, Stove Top Stuffing, Loius Rich Meat,
    Claussen pickles

    Oscar Mayer

    Kraft Foods

    Numerous cheeses (Philadelphia, Velveeta, Cracker Barrel, Di Giorno)

    Pizza (Di Giorno's, Tombstone and Jack's)

    Oh, and they also own some beers you might know (Miller brewing company, Foster's, Molson, Red Dog, Icehouse, Mickey's, Olde English, Meister Brau, Leinenkugals, Celis, Shipyard, Sharps and Magnum)

    Have i made my point? because I could go on...

    Plus, with individual stocks, you do not have to pay the year to year fees, on top of year to year capital gains taxes.

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