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May 10, 2007
PlanetOut going down?
Posted by: Chris
The stock price of Planet Out is reeling today from news yesterday of weaker than reported sales for the first quarter and a net loss of $6.6 million for the same period. The stock began the day at $2.25, already an all-time low for the company, which trades under the symbol LGBT on the Nasdaq. In the first 20 minutes or so of trading, the price had plummeted to $1.45 per share.
As I post, the stock has rallied a bit, to $1.62 per share — but still a loss of more than one-third its value just since yesterday's closing price. To put that in perspective, Planet Out was trading at $15 per share as recently as January 2005, and even $10 a year ago. The price began the year at $4.50 but had dropped to $2.49 per share by the end of the day yesterday.
Hopefully, the rally will hold. Whatever you think of PlanetOut and its shifting focus and publishing standards at the Advocate and Out magazines, the failure of the first-ever publicly traded gay business would be a blow to others who hope to repeat PlanetOut's early success.
Its two marquee print titles have already shown marked improvement under new editors since the departure of corporate editorial director Judy Weider. PlanetOut has already survived the dot-com bust; it would be a shame if it petered out now.
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dan on May 10, 2007 1:32:25 PM:
the best part of the depressing conference call where everyone from planet out sounds like they are facing a fire squad, comes at approximately 38.1 when david beckler from some fund management group suggests to karen magee that they should take salary cuts since they pretty much admitted that the company is doing badly because they don't know what they're doing. the gulp is almost audible. but he's right...everything that was said in relation to the poor performance could be summed up as "we haven't been paying attention, we bought a whole bunch of companies we didn't know anything about and ran them badly, and our employees can't stand to work here and keep leaving and we haven't replaced them..." they are being required by their lender to raise an additional 15 million dollars in capital, which they can only do by selling stock, which is already tanking. investors are really fed up with this, particularly since they announced today that the only part of their company making money is the porn business (Specialty Publications) but since porn is icky, they are selling it. Short term influx of cash sure, but what are they thinking in terms of long term?