VerticalNet (Nasdaq: VERT) stock was at more than $100 (US$) in early trading today, which begs the question: What is Lehman Brothers thinking now?
On Monday, Lehman Brothers, and Hambrecht & Quist both initiated coverage of VerticalNet, which operates business-to-business community sites for various industries, with buy ratings. Lehman, which took VerticalNet public at $16 last month set a price target of $70. On Monday, VerticalNet shattered that target, climbing 19-9/16 to 74-1/16.
Now the stock is close to doubling in four days, and shares are trading for more than six times what they were when VerticalNet went public. This is momentum trading at its most extreme. Day traders are obviously having a field day with this one, but it’s hard to tell what else is fueling this.
There could be a big announcement looming. Two buy ratings are hardly enough to justify what’s happened this week.