Profiteering On Offshoring & Outsourcing (ETEL)
March 28, 2007 by Douglas A. McIntyreWho says Americans can’t profit all on their own from outsourcing and offshoring, or even from losing their jobs? eTelecare Global Solutions, Inc. (ETEL-NASDAQ) priced its IPO of 5,500,000 at a price of$13.50 per ADS, within the $12.50 to $14.50 price range. It saw a low of $13.60 right after the open, but it didn’t look back. Shares closed up almost 8% from the pricing at $14.55 and printed as high as $15.75.
eTelecare was profitable in 2006: revenue was $195.1 million, operatingmargin was 9.9% and net income was $12.2 million. For 2005, net revenuewas $152.2 million, operating margin was 2.7%, and net loss was $1.8million. The company refers to as "Business Process Outsourcing" which is reallyan OUTSOURCED CALL CENTER operator. Here is the full description.
You can probably bet hard money that call center operator owners in India and elsewhere were licking their chops today after seeing that this was a success. At least call center workers in the US can hedge their jobs. As they get fired in favor of offshore call centers, at least the stock can go up.
Jon C. Ogg
March 28, 2007
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