Dangerous Nielsen IPO That Could Put You In Hospital

At hand is tons of hum on the street about the future Nielsen IPO.

Provided you have not heard about it, what rock have you been hiding under?

This is what is going down my friend.

Nielsen Holdings, best known for its TV ratings business, has operations in roughly 100 countries and yearly revenue of about $4.8 billion.

Nielsen, the tv ratings and customer research company, wants to raise $1.9 billion in an initial public offering.

Nielsen, which is based in the Netherlands, acknowledged in a filing with the Securities and Exchange Commission (SEC) that it will use proceeds to trim down its debt of $8.8 billion and for wide-ranging corporate purposes.

Come again? Hence in other words, Nielsen desires to do an IPO to pay its bills. This sounds like Nielsen is in big trouble. Nielsen just had to sell its recognized publications Billboard and The Hollywood Reporter. They are in a ton of trouble.

The trouble is the niche that Nielsen has enjoyed operating in for so many years. Nielsen no longer is emperor of the niche. In theory, Nielsen looks to have been moved down to third rank at best. The niche is at this time much more competitive than it has been in the past thanks to advances in technology.

With new technologies in cable TV and satellite broadcast services, cable operators like Comcast can put on the market viewership data that is collected from their cable boxes successfully eliminating the necessity for Nielsen boxes. Most recently even Google is working to get in on the action with their Google TV that is set to be released in early 2011. Google knows the value of data collected by cable boxes. There is just no way that Nielsen can battle against the likes of Comcast and Google.

If that is not adequate logic for why you should keep away from this IPO then mull over the hostile to IPO market we are in. There has been an uncommonly high number of IPOs that have ended up being priced under what was initially desired. Investors have simply been willing to buy IPOs priced at a deep mark down. So the question begs, how can Nielsen Holdings shoot for an IPO right now in this market? The reason may be because they have to in an effort to pay the bills.

I can think of a ton of better reasons to buy an IPO such as a solar panel manufacturing company implementing an IPO to build another manufacturing plant. This is an IPO I would keep away from. There is something that rubs me the wrong way about a business using an IPO just to pay the bills. If that is not a huge gigantic red flashing warning sign to stock traders, I don't know what is.