“Analysts Contend Stock
Market Isn’t as Bullish
As It Appears to Be
Placement of venture capital with San Diego firms more than doubled in the second quarter when compared to last year’s activity.
Southern California firms were able to raise 60 percent more capital than last year in the third quarter as well, a national accounting firm reports.
Officials with PriceWaterhouseCoopers said $198 million in venture capital found its way to San Diego County firms during the second quarter. That’s up from $94.7 million in the second quarter of 1998.
Companies in the Los Angeles region were the largest recipients, with $366.4 million placed, up from $93 million last year in the second quarter.
Aerospace and telecommunications companies were the major recipients of capital during the third quarter, said Claudia Morlan, a spokeswoman for Bowne of Los Angeles, a financial publishing company, which also issued its own report on venture capital funding.
“The communications and biotech sector showed investment activity in the first half of 1999, with $92 million in 10 deals and $67 million invested in 13 companies,” said Massoud Entekhabi, a PriceWaterhouse spokesman.
Among the firms receiving venture capital were Tachyon of Del Mar, which raised $30 million; Medibuy.Com of La Mesa, which raised $16 million; and CollegeClub.Com of San Diego with $11.3 million, he said. Biotech firms that raised money included Arena Pharmaceuticals, with $17 million; Elitra Pharmaceuticals, with $16 million; and X-Ceptor Therapeutics with $11.1 million. All are San Diego firms.
Medical device company getting cash infusions included Bridge Medical Corp. of Solana Beach, $31 million; Neurothemia with $10 million; and Hemotherapies with $7.5 million, he said.
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Heard On The Street: For the less-venturesome capitalist, there is always the stock market.
But if your portfolio has been struggling this year, Hokanson Capital Management Inc. of Solana Beach says you have company.
“The Value Line Index indicates that the average stock is actually down 1.26 percent (year to date). While the S & P; 500 is up 8.64 percent, the average stock comprising this index is down double digits,” Neil Hokanson said in his latest newsletter.
“In fact, more than 60 percent of all NYSE stocks and more than 80 percent of all Nasdaq stocks are down 20 percent or more from this year’s highs. It is yet another year where a relatively few stocks create the appearance of a very strong market,”
Yet Jeffrey A. Dunham, a principal of Dunham & Associates Investment Counselors Inc. of San Diego, points out Fed chairman Alan Greenspan is still concerned about inflation rates powered by “solid job/income growth, easy credit and soaring capital gains.”
Dunham went on to say: “With incomes rising, consumer confidence near a three-decade high and unemployment at its lowest in 29 years, people are spending at a fast clip. Sales grew 6.9 percent in July, giving retailers their strongest stretch of sales gains in at least a decade.”
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Bank Notes: Union Bank of California just celebrated the opening of its first branch in San Ysidro. Scripps Financial Corp., parent company of Scripps Bank of La Jolla, has been approved for listing on the American Stock Exchange. Fallbrook National Bank has started offering Internet-based banking. Jan K. Grewal, vice president and manager of the La Jolla Private Banking office for California Bank & Trust was elected to the San Diego Museum of Art’s board of trustees. Sheryl L. Roling, a principal of Roling. Dold & Associates of San Diego, has been selected as one of the nation’s top 250 financial planners by Worth magazine.”