United Online (UNTD) Looks For Redemption
United Online (UNTD) is in a crummy business. It sells dial-up internet service to about five million online customers. It is the business that AOL exited last year. Broadband has made it obsolete. The company’s revenues are only about $130…
United Online (UNTD) is in a crummy business. It sells dial-up internet service to about five million online customers. It is the business that AOL exited last year. Broadband has made it obsolete. The company’s revenues are only about $130 million a quarter.
United has a market cap of $900 million, so it trades at less than 2x sales. Its stock has gone nowhere since 2003.
But, all of that may be about to change. United also owns Classmates.com, a large social network set up to put together people who were in school at the same time. UNTD filed an S-1 yesterday to IPO Classmates and raise $125 million.
In the quarter ending March 31, Classmates had revenue of $42.4 million and lost $250,000. The business is growing. Revenue in 2005 was $84.8 million. Last year, that number rose to $139 million.
Based on the numbers that get thrown around for the value of Facebook. Classmates could be a high-priced property. It could well be on its way to revenue of over $200 million this year.
If so, Classmates is worth well over $1 billion, more than United’s entire market cap.
Douglas A. McIntyre
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Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.
McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.
His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.
A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.
TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.
McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.
