Playboy’s (NYSE:PLA) Numbers Don’t Add Up to Much in Regard to the FriendFinder IPO
Source: http://feedproxy.google.com/~r/ContrarianProfits/~3/M70ts8GKAa8/17512Posted on Wednesday, June 3rd, 2009 | In Market Commentary
A comparison of Playboy Enterprises, Inc. (NYSE:PLA) and Marvel Entertainment, Inc. (NYSE:MVL) allows us to define the only proper strategy to trade the upcoming FriendFinder Networks IPO.
The times, they are a-changin’! These days, you could become 51% owner of Playboy Enterprises, Inc. (NYSE:PLA) for less than $50 million. I’m not sure what you’d do with half of Hef’s robe or half of his harem of nubile blondes. But it sure has a certain ring to it!
If you wanted to become half-owner of Marvel Entertainment, Inc. (NYSE:MVL), however, you’d have to shell out $1.35 billion! Comic books are now worth 27 times as much as the well-written articles and witty cartoons that I hear are the sales engine of Playboy magazine.
The interesting part of this is that the demographic both businesses used to appeal to are nearly identical: Adolescent and post-adolescent male virgins.
Only that Playboy’s original audience apparently has outgrown the franchise. While Marvel’s demographics steadfastly refuses to grow up.
Of course, it’s never too late to have a happy childhood.
But there’s a lesson in it regarding what’s shaping up to be the most titillating IPO this year: After dragging their feet for over a year, “adult” social networking company FriendFinder Networks—which absorbed Playboy’s competitor Penthouse a while ago—filed it’s Form S1 with the SEC
on May 18.
The company remains heavily loss-making as free networking and porn sites are eroding what’s left of its market share. Whatever fizz there will be in the actual offering will be media-generated.
The proposed ticker for this stock is NYSE:FFN, which unfortunately remains taken by an unrelated company, the initial amount of the offering (filed last December) was $460 million.
It looks like a prime candidate to shorting the day after the IPO is launched.
Source: Playboy’s (NYSE:PLA) Numbers Don’t Add Up to Much in Regard to the FriendFinder IPO
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