Wednesday, March 08, 2006

Hit #84

iVillage (IVIL) is being acquired by NBC for $600 million in a cash deal. The offer amounts to $8.5/share, a premium of 102% to my average cost of $4.21/share.

Given iVillage's leadership position, not to mention its ability to generate real revenues, I feel that the company has been sold cheaply. If nothing else, iVillage should have gone for an auction among various bidders and I bet there would have been other interested parties like MSN and Interactive Corp.

I had mentioned iVillage in a few earlier posts, here, here and here.

A few other content owners remain targets, though very few can be considered cheap. The wedding portal, Knot (KNOT), is one such target. A substantial discount to its current price is needed for it to become attractive.

Online niche retailers like Blue Nile (NILE), Odimo (ODMO) and Red Envelope (REDE) are also potential targets. Red Envelope is the most attractively priced among them. Odimo remains speculative.

CNet (CNET) will be acquired - the only question is "at what price" ? I would like to see a 30% discount before considering buying it. PlanetOut (LGBT), the gay/lesbian portal, also is a property that major media outlets would like to own, though they may decide to wait out the current environment before doing so. The stock looks attractive right now.

One property that definitely looks like a bargain today is Jupiter Media (JUPM). The spectular runup in rival Getty Images (GYI)' stock should give you some idea of the potential - Getty Images' stock has risen from $9 in 2002 to around $81 today.

I own Odimo and Red Envelope stock. I would like to add Jupiter Media, Planet Out and Blue Nile soon.

Previous hit - BellSouth (#83)


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