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Edgar Online Inc. (NASDAQ: EDGR)
Chairman: Marc Strausberg
Chief executive officer:
Susan Strausberg
Revenues: (FYE December 31, 1999): $5,249, 358
Net loss (FYE December 31, 1999): ($4,162,861)
Market capitalization: $40.49 million
Employees: 45
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Business New Haven
8/7/2000
By: Kristine Hansen
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Doing detective work like Dragnet's Joe Friday always meant getting “just the facts, ma'am.” Through Edgar Online sleuths in the business world can get just the facts with the company's online access to documents filed with the Securities & Exchange Commission (SEC).
It is the SEC that is responsible for protecting investors. As such it requires that publicly held companies file specific documents within a specified time frame. The 10-K - a report including detailed financial information - must be filed each year. Then there is the 10-Q - the quarterly report that must be filed after each quarter. Miscellaneous documents include initial public offering (IPO) registration statements, proxy statements, 8-K filings for material events which occurred at a company (i.e., a CEO resigns) and 13-Ds and -Gs regarding ownership information.
Since 1984 companies have been able to file such forms electronically to the SEC's “electronic data gathering analysis and retrieval system” (EDGAR). Before the days of Internet access, gleaning information from these documents was cumbersome and costly. Now this same information may be found, sometimes for free, through various Internet sites including the SEC's site, http://www.sec.gov. Today, through the use of information-access companies such as Edgar Online, a customer may have ready access to those SEC documents filed throughout the year by some 15,000 public U.S. companies.
Incorporated in 1995 under its flagship name, Cybernet Data Systems Inc., the company focused on the individual customer looking to access SEC documents. In addition, the company also provided selected Edgar content to such search engines as Yahoo!, Alta Vista and Lycos, as well as to news agencies including CBS MarketWatch and SmartMoney.com.
In January 1999 the company changed its name to Edgar Online Inc. and went public that June. IPO proceeds of $34 million were set aside for company expansion and to target a corporate clientele. Edgar opened a Manhattan office and increased its sales staff. As of February 2000, the company had more than 150 corporate customers and more than 325,000 registered users, including 14,500 paying subscribers.
The company uses audience-specific Web sites depending on the research needs of its customers. One of its main sites, Edgar Online (www.edgar-online.com), offers search options like Edgar OnlinePeople (www.edgar-online.com/people) for accessing information about company executives.
EDGAR Online IPO Express (www.ipo-express.com) offers information on the IPO market, including filings and pricing. The company's Edgar Online Personal provides an e-mail service for updates and personalized searching of SEC information.
With five years of history behind it, Edgar Online has increased its revenue base primarily generated from subscriptions, corporate sales and advertising. Revenues for 1999 were $5.249 million, more than double 1998 revenues of $2.003 million. For the three months ended March 31, revenues were $1.975 million, compared to $611,000 for the comparable 1999 quarter.
But profits remain elusive. The company incurred a net loss of $4.163 million (minus 42 cents per diluted share) for the 1999 fiscal year, compared to a net loss of $2.221 million (minus 36 cents per diluted share) for the 1998 year. For the first quarter of this year Edgar reported a net loss of $2.498 million (minus 20 cents per diluted share), compared to the comparable 1999 first quarter loss of $586,000.
Although the company's stock moved up to the 15 range in March, it then slid to a 52-week low of $3 on July 7, rebounding slightly to close at 3 1/4 on July 12. Analysts are recommending a buy/strong buy, but per-share earnings estimates remain in the red for this year and next.
With competitors like Internet Financial Network and Primark's Discloser lurking in the shadows, Edgar Online does not have the market cornered. But the company does have something going for it: the name Edgar, which is closely identifiable with SEC information. It also has a CEO, Susan Strausberg, who in January was named to the Silicon Alley Reporter magazine's “Top 100 Silicon Alley Net Executives” list.
The company has already established several strategic relationships with information-providers such as Reuters, Standard & Poor's and Hoover's. Recently the company announced two separate agreements to provide SEC-derived information to Dun & Bradstreet and OneSource Information Services, Inc.
In June the company introduced its revised and easier-to-use Web site, www.edgar-online.com. Edgar Online makes getting the facts easier. Joe Friday would be pleased.
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