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WIKI ANALYSIS
Bankrate, Inc. (NYSE:RATE) is an aggregator of financial rate information for American banks and lending institutions. The company owns and operates an Internet-based, consumer banking marketplace, licenses data, and editorial content to publishers and institutions, and operates a newsletter business. Bankrate continually surveys approximately 4,800 financial institutions in all 50 states in order to provide comparable rates to consumers.
The company's flagship Web site, Bankrate.com, provides free rate information to consumers on more than 300 financial products, including mortgages, credit cards, new and used automobile loans, money market accounts, certificates of deposit, checking and ATM fees, home equity loans and online banking fees. In addition to rate data, the company presents personal finance editorial content to help consumers make informed financial decisions.
Because of the current economic environment, financial resource websites such as Bankrate.com have seen an increase in unique hits. The challenge has come in turning the increased traffic into greater revenue. This has been a problem since the economic downturn, because of a decrease in advertising spending, especially in internet display ads. The concern for Bankrate, Inc is that there is a double negative effect because along with ad revenue Bankrate also collects revenue for every lead that generates a sale. [1]
Company Overview
Bankrate, Inc., together with its subsidiaries, owns and operates an Internet-based consumer banking and personal finance network. The company's main website, Bankrate.com provides information on numerous financial products such as mortgages, cds, investments, credit cards, auto loans, insurance, debt management, student loans, retirement options and taxes. It provides information regarding the fees and comparable rates from competing financial providers.
Bankrate, Inc operates through two segments, Online Publishing, and Print Publishing and Licensing.
- The Online Publishing segment engages in the sale of advertising, sponsorships, leads, and hyperlinks through Bankrate.com, Interest.com, Bankaholic.com, Mortgage-calc.com, CreditCardGuide.com, Nationwidecardservices.com, creditcardsearchengine.com, Savingforcollege.com, Feedisclosure.com, Insureme.com, and Bankrate.com.cn (China). Financial institutions and marketers purchase graphic ads on these sites in the form of banner, badge, billboard, poster, and island advertisements. [2]
- The Print Publishing and Licensing segment sells advertising in the Mortgage Guide, and Deposit and CD Guide rate tables; newsletter subscription; and licensing of research information. According to Bankrate, Inc. the over 500 financial institutions who are listed on their rate tables purchase hyperlinks. These links connect consumers directly to the financial institution’s Web site, application page, or customer service department, allowing the lender to directly reach “in-market” consumers on the Bankrate site. Bankrate has revenue-sharing agreements with over 75 online partners, including Yahoo!, America Online, MSN, The Wall Street Journal Online and The New York Times Online.[3]
- Bankrate, Inc. also markets consumer and business credit cards, as well as insurance rates for auto, home, life, health, and long-term care. In addition, revenue is also generated by distributing rate information and content in newspapers and magazines across the United States. Approximately 100 newspapers, including eight of the nation's top 10, distribute Bankrate’s content. The company’s distribution partners include The Wall Street Journal, The New York Times, USA Today, and numerous other national and regional publications. Bankrate publishes newsletters and licenses research data under agreements that permit the use of the data in other media. Bankrate also generates revenue by providing rate surveys to institutions and government agencies. [4]
For the full year 2010, Bankrate reported a total revenue of $220.5M and $21.5M in net loss. This was 67% increase in revenue from the previous year.[7]
New Updates
The company's initial public offering of stock on the NYSE occurred on June 16, 2011. The company offered 20M shares each for $15 right at the midpoint of the initial price range of $14-$16. The offering raised a total of $300M. The lead managers of the IPO were Goldman Sachs Group (GS), Bank Of America (MXK:BAC), Citigroup (C), and J P Morgan Chase (JPM). [8]
Business and Financial Metrics
References
- ↑ Despite The Eyeballs, Ad Slowdown Hurts Bankrate
- ↑ Bankrate Company Profile
- ↑ Bankrate Company Profile
- ↑ Bankrate Company Profile
- ↑ Yahoo Finance RATE
- ↑ Citation
- ↑ Bankrate S-1/A 2011 SUMMARY "SUMMARY HISTORICAL AND PRO FORMA FINANCIAL DATA " pg 9-10
- ↑ Renaissance Capital - IPO Home "Bankrate prices IPO at $15, midpoint of the range" 16 June 2011
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