IPOs - Page 4

I don't think it was Fidelity's restriction

Unless you are an insider, it is to my understanding that they cannot restrict your hold period. Unless you work for a financial firm that restricts your hold period, you are good to sell. Sell Mortimer....Sell!

It's simply the ROI demanded for such a risky industry. The majority of the most brilliant and elegant new products I've seen featured and rolled out simply never stick. A tech startup is only slightly less risky than a mining exploration firm when it comes to actually making ends meet.

Some of the toys my friends get to work with are simply amazing though. I can fully understand the R&D costs when they get to have a clean room (for testing components) the size of a warehouse, along with the commensurate maintenance and operational costs. Also, $50 000 oscilloscopes. They're spoilt rotten.

FB is definitely overvalued. I but I don't doubt that the market will continue to over value it for years. There core business model is riding a high, and as long as people use it and respond to ads, well FB will always stay in the money.

Is it a good IPO to invest in if given the chance to buy in at initial price? Ofcourse!
Will it rise throughout the year because the world wants to believe that things are better and Facebook is their savior? Jesus, yes!
Is the market crazy and unpredictable? Never, the future is unpredictable, and hence effects the predictability of everything that exists. For the most part we know that this is a 'godsend' IPO for the tech world, putting thoughts like the 'new tech bubble' in peoples heads. Facebook has good value, but its overvalue is due to emotions and these beliefs.

Conclusion: Ride the high, while it lasts.expect correlation between goog znga aapl msft etc.. expect the market to really think its the best thing to happen since sliced bread. Eventually the hype will die down.

IMO, facebook is better off not going public, it does not need to. They have enough cash to stay afloat and if zucky is smart he'll stay private for as long as possible.

Now my question is, what would happen to those with private stock in the company, are the public shares being created a second class with less majority of the current class of shares? ? Are they going to go the GOOG route (Dutch auction) for their IPO?

They are only selling 10% of the company. Those with private stock are unaffected essentially.

They really do need to go public if they have over 500 shareholders of record as per the SEC rule. They have over 500 currently.

Its not necessary to go public and hold an IPO though, yes go public with their financial statements and etc.. but nothing requires them to have to file for an IPO.

I am completely clueless about these securities exchanges, so will someone one humor me and and try to answer my question?:

Is it possible and if so how would one make a profit from these IPOS given that what I have seen the price fluctuates somewhat predicatbly in that it starts of fat its initial price then shoots up.

Could one buy 10 million dollars of an ipo and hover over some button on your computer and click "sell" at the point where you see profitable (so to speak, or contact a broker or ?)? What are the restrictions and fees involved, why doesn't everyone do this?

--clueless from Seattle.

I think only a certain amount of investors can buy the stock before it goes public so if you dont have the option you wouldn't be able to buy it before the public does. Also, a lot of recent IPOs have seen the first day "pop" in the prices especially like tech companies but it's also possible that it goes down from the initial price especially if the banks priced the shares too high (i think Zynga is an example)

Yeah, not everybody has the option to buy at the ipo price. Mostly large institutional investors that buy in very large amounts. When you see prices shoot up like that it is in the secondard market (after the initial investors sell) and, imo, it means the banks did a shitty job at valuating the company. It means they could have potentially secured that much more capital for the firm in the ipo. It would be wise to see the secondardy market price hover around what the ipo price was in the short term until something in the fundamentals of the company changes in order to move the present value of the shares.

Thank you guys, this clears up a lot.

yeah what patrick said

yup couldn't agree more with that point

I've never heard of a company going public without having an IPO. I think you may be confusing being an SEC filer and being a publicly traded company. This usually happens with private companies with publicly traded debt.

I'm sure you can file all the paperwork with the SEC and not be publicly traded but this severely limits your shareholders on monetizing their stake. Who wants to get paid through stock or own stock in a Company if you're not allowed to sell on the open market to get fair value?

no not confusing, just nit picking the actual rule. Companies can file with SEC their paperwork and that makes them public - because then you can look it up and pull out the information, a private company does not have to do that. A public company does not have to File an IPO, but generally at that point many have, like Google and upcoming like Facebook, because partially they say 'why not? we are public anyway in terms of disclosing information'. So they have a choice to not file for IPO, but still must file their financial docs

http://www.usnews.com/news/articles/2012/01/31/why-the-facebook-ipo-is-overhyped?google_editors_picks=true

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