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Google Sets IPO Pricing
It appears that Google has set their IPO price - 108$ - 135$ per share. Yowza. A reminder that this is done through the Dutch Auction ? process, which makes that pricing even more...uh...interesting.
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Will going public affect google at all in terms of service, and their search algorithm? Investors won't get higher returns in searches will they?
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story about underwriters crying about the whole auction process and fear that price will be so high that market collapses after. Given their idiotic pricing and occaisionally illegal distributions in dot bomb ipo's, why should anybody take them seriously? Of particular note is that they are being paid significantly less than a standard IPO.
I find it difficult to believe that this stock price can be maintained... It puts Google as about 60% of the value of the US auto/truck industry (GM + Ford), or about the value of Boeing.
The only people making $$ on this are those in the middle, or those starting out with Google shares.
With a high IPO like that, going 'short' after a couple of weeks might be a good strategy. The market is not stable and many outside influences (energy costs, Iraq setbacks) could easily drop 10% out in a day.
A bigger drop will possibly happen around election time. Whether irrational or not, Democrat wins tend to drop the market initially.
*NOTE* - the above statement is not my political preference, just an observation of how the 2k2 elections were referenced in the same manner
Not that simple. Also depends on how many shares they sell. I seem to remember some high-faluting company that has $10,000 per share prices... but there are only a few thousand shares of stock issued.
Would it make you feel better if they issued stock at $20 per share, but put 5 or 6 times as many into circulation?
I've always been fascinated by people's fixation on the share price when it means absolutely NOTHING in the grand scheme of things.
A stock's value is calculated by the share price times the total number of shares outstanding. Now, Hemos was quick to comment on the share price, but lacks the understanding to figure out just how much cash the company is raising and what the total value of the company will be at these levels.
But who cares?
It really doesn't matter because the average investor doesn't know any better. This is the same reason that stocks go up when the company announces a stock split. The idiots eat these stocks up because they think that there's something magical about owning a stock through the split. "The company gives you more shares", responded an ignorant investor after I queried him on his voracious appetite for buying companies that are ripe for splitting. What he failed to realize is that the price drops proportionally - the value of the company (and each investor's holdings) is the same before and after the split. But nevertheless, owning these companies through the split is often a very profitable method of investing simply because of all the ignorance out there. Never underestimate the power of stupid people in large quantities.
It makes me want to shoot myself in the face.
Life is the leading cause of death in America.
Also, how can the market cap be $36.25B when 24.6M x $135 = $3.3B? For the market cap to be $36.25B at 24.6 M shares, the share price needs to be $1473.58. If the share price is $135, that means there are really 268.5M shares and less than 10% were made public.
Perhaps there was a misplaced decimal point in that $36.25B number?
"There are a dozen opinions on a matter until you know the truth. Then there is only one." - CS Lewis (paraprhase)
You're talking outta yer damn ass. It took 3 years to build the Titanic. It wasn't rushed at all. No corners were cut; in fact, no expense was spared. And it wasn't a design problem or cut corners that sunk the Titanic. It hit a fucking iceberg! What's wrong with you?
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The strategy is to keep people from buying stocks at $10 a share until after the rich folks have capitalized on the 1st round at $130 a share. Afterwards, there has to be a split which will send a frenzy to buy the stocks again by the common joe. Followed by a complete burnout. Then it'll go back up and cycle continues.
Trust me, I have owned multiple pre-IPO stocks to know the experience. Rich folks will profit 2 or 3x before the regular folks even get their hands on it. No, I am not some harvard junkie regurgitating garbage from the wallstreet journals.
Step 1 hasn't changed in a long time. [...]
Not much innovation recently.
I think that's a plus, not a minus. That's like saying the telephone hasn't seen much innovation because we're still just putting our mouth to a hole and talking.
Caching a copy of the web was certainly innovative. Google's news search was innovative. Their AdWords program broke new ground. They've also continued to add a variety of special features, including special functionality for addresses, phone numbers, calculations, hot news topics, and package tracking numbers. And although you can't see it, their behind-the-scenes operations are very innovative.
And really, I think keeping Google's simple interface has been one of their biggest innovations. For years, everybody thought thing thing to do was to clutter up your main pages with boatloads of crap. Google's relentless focus on what their users want, rather than what their MBAs think is the best way to squeeze revenue from their users, was a huge gamble that has paid off beautifully.
The idiots eat these stocks up because they think that there's something magical about owning a stock through the split. It makes me want to shoot myself in the face.
It may be stupid, but play it. Then you can shoot yourself in the face while relaxing on your 50 ft yaht. The market is mostly psychology.