Journal of Economics and Finance

, Volume 28, Issue 1, pp 104–116

Early internet IPOs versus subsequent entrants

  • Beverly B. Marshall
  • Claire E. Crutchley
  • Diane Lending
Article

DOI: 10.1007/BF02761458

Cite this article as:
Marshall, B.B., Crutchley, C.E. & Lending, D. J Econ Finan (2004) 28: 104. doi:10.1007/BF02761458

Abstract

This paper examines whether investors in early Internet IPOs earned superior returns to those who invested in later entrants. We document three differences between early public firms in a new Internet technology and their followers: underpricing, operating characteristics at the IPO, and stock price performance after the IPO. We find that there is value in going public relatively early in a new Internet technology. Specifically, long-term returns are significantly higher for the early entrants. We also find evidence, consistent with previous studies that examine hot IPO markets, that the early public firms have better operating characteristics at the IPO than later entrants.

Copyright information

© Academy of Economics and Finance 2004

Authors and Affiliations

  • Beverly B. Marshall
    • 1
  • Claire E. Crutchley
    • 1
  • Diane Lending
    • 2
  1. 1.Department of FinanceAuburn UniversityAuburn
  2. 2.CIS/OM Program, College of BusinessJames Madison UniversityHarrisonburg