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The CEO commented that he was "happy" with the IPO price. Given that CEO's generally are not happy with leaving 100% on the table, I would surmise he knows it's overvalued.
The CEO commented that he was "happy" with the IPO price. Given that CEO's generally are not happy with leaving 100% on the table, I would surmise he knows it's overvalued.
http://www.newyorker.com/online/blogs/johncassidy/2011/05/li...
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and assuming you can find shares to short, and are willing to pay the borrow cost.
During the first 30 days after an IPO, the underwriters are not allowed to lend shares for short sale. Additionally, number of shares are limited. The entire float is not available on the first day of trading. So today, it is probably impossible to short. 30 days from now, it should be available to short. http://cash.investopedia.com/ask/answers/05/062905.asp
LinkedIn made $15 million dollars last year, and they just raised $660 million dollars out of the gate in this IPO. And, this IPO values LinkedIn at somewhere close to 6.5 billion dollars. A valuation of 6.5 billion dollars on $15 million net income. Let that sink in.
Quora has been able to thrive and create a truly compelling site in a short time, even with LinkedIn Answers having so many numbers in its favor.
Namesake has been getting traction and executing well -- their valuation has definitely just gone up as well.
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That really doesn't make any sense. As anyone who knows the stock market will tell you, if you can guess the price of a stock before the market opens, you'd be a wealthy man. But underwriters are conservative with initial IPO pricings because 1) they have no real idea where a stock will go once it's public and 2) they want the stock to go up after it opens (IPOs that don't do this are said to be "broken" and sometime…
Those are good points, and I'm not arguing that they left a lot of money on the table or didn't, but what I am disputing is where you said "We won't know whether the $45 price was optimal or not for a while --it may seem expensive in 90 days when the price settles down." Why does the price 90 days from now matter to the judgement of whether or not the initial sale - today's sale only - was a success? If the price dro…
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Based on there IPO prospectus from sec.gov: Year; Revenue; Costs; Income 2008; 78,773; 84,282; (4,522) 2009; 120,127; 123,482; (3,973) 2010; 243,099; 223,523; 15,385 expense growth is 46%, 82% yoy. revenue growth is 52%, 103% yoy. So, you have a company that is growing revenue faster than expenses, has 100% year over year revenue growth, and has just hit the inflection point to be profitable... and you want to place…
And just to be clear, an incredibly easy ballpark valuation would be to just take the midpoints of the rev / cost growth and go 3 years out... which gives $1.3B revenue on $1.1B costs = $200M profit. A slightly high market multiple on that (18) would still be only $3.6B. And there will be dilution, selling pressure from insiders whose lockup periods will be ending, lumpiness in the numbers... I certainly would not bu…
Why else would a CEO say anything different? I've been through an IPO and basically heard the same thing from the CEO.
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>>*"they just raised $660 million dollars out of the gate in this IPO" No, that's not how it works. LinkedIn priced their IPO at $45/share, meaning they raised $352.8 million. The share price right now has no impact on how much money they raised.
They left a lot of money on the table.
http://blogs.forbes.com/greatspeculations/2011/05/19/linkedi...