Penthouse to IPO - Why Bother?

Penthouse Media Group Inc plans to raise $250 million in a IPO and expects to file a registration statement with the U.S. SEC sometime in Q2 2008.  I wonder what type of centerfold they'll have for their Quarterly reports, probably pie charts?

If Playboy Enterprises, Inc. (Public, NYSE:PLA) can do it, so can Penthouse.  But PLA has hardly been a good investment for shareholders.  Playboy Enterprises hasn't traded over $20 since 2000, $15 since 2006, and as of Friday it closed at $8.50 a share.

Penthouse's famous magazine "softened" their content back in January 2005, they no longer show genitalia, real or simulated sex, or other hardcore content.  Well that makes for an upstanding read, let's buy the stock now.

So with print dying and even the 'soft core' porn business, why even bother trying to IPO?

Hold on, Penthouse Media owns AdultFriendFinder (dot) com and its 22 million 'active' members. We'd provide a link but then I'm sure our hosting would be killed in 24 hours.

Penthouse Media Group's recently acquired other sites, which also include Passion.com and BigChurch.com, a site for Christians who want prayer mates, have a total of 45 million active members.  What a concept, gulity pleasures then repent your guilty pleasures, they should really crosslink ads. Hard to believe I know, but it's starting to sound like Penthouse has a chance at being a public company.

The list of accomplishments and low down on Penthouse Media Group can be found in this ABC article: 

Penthouse IPO: A Winner ... or Just a Tease?

But fellow Masters, if some of the best companies in the world are having a hard time staying afloat right now, how could Penthouse do any better?

Online sites like AdultFriendFinder have been around a long time and even with millions to spend on trying increase their audiance, how successful of a business venture can it be for shareholders? Who cares if they have figured out a way to cash in selling sex using mobile phones; Wall Street only cares about growth, stability, and future ROI.

If Penthouse does IPO, it may be worth watching, but a long term investment? 

Just imagine some guy at Merrill Lynch recommending Penthouse Media for a baby boomer's IRA:
"No Tom, the IPO is really going to be something and they don't do hard core porn anymore, they've really cleaned up their act. Hold on, don't go to that site, you may get fired.  No, not that one either and do not click on that Ad.  Tom?  You didn't click on that Ad did you?  Oh well, yea, it's a great investment."