Shares in Gay.com publisher, PlanetOut rose 20 per cent on Nasdaq yesterday, but shares in the company are still worth less than a tenth of it’s post IPO (initial public offering) value just under three years ago.

The company which also owns the Adovocate and RSVP Cruises floated in October 2004 at a share price of $9 (£4.48), it quickly rose to $14.26 (£7.10) in November. Yesterday the company’s shares were trading at $1.38 (£0.69), a marked improvement on its 52 week low of $0.86 (£0.43).

“PlanetOut remains a work in progress,” Roth Capital Partners analyst Richard Ingrassia told Dow Jones, he added that he believes the company is undervalued.

In the USA, PlanetOut faces competition from MTV owner Viacom who run the Logo gay television network, itself owning 365Gay.com, AfterEllen.com and AfterElton.com. And Washington Blade owner, Window Media LLC.

In the UK, PlanetOut publishes UK.Gay.com which competes with the larger gay dating site Gaydar. It of course competes with PinkNews.co.uk in terms of gay news and lifestyle coverage. However, there are no available statistics for UK.Gay.com’s small news section edited by Stuart Who to accurately compare market share within Britain.

PlanetOut Chief Executive Karen Magee told Dow Jones that it would take at least 12 to 24 months to turn PlanetOut around and that the company may sell its adult businesses.

As of Friday, the company is worth $24.4m (£12.15m)