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Google Goes Public at $85/share
adpowers writes "It is official. Google will have its IPO debut at $85 per share. To quote the article, 'At that price, the low end of its recently revised range, Google raised $1.67 billion, with $1.2 billion to go to the No. 1 Internet search engine and $473 million to Google executives and investors selling their shares.' Trading begins Thursday, August 19th." Got Google?
The Economist has a good article giving analysis of the IPO.
Why not use the google stock tool to google's Stock...
I remember Cisco used to be about 85$....
I love it when people consider the cost per stock as an indicator of whether a company is overvalued. It is people like you who create arbitrage in the market for the rest of us to exploit...
Different companies have different number of stocks you know. $85 gives Google a total value of $23 Billion (market capitalization), while Cisco is still worth around $150 billion...
Probably not that many, at least in cash terms - plenty will be paper millionaires. Most employee share option schemes have clauses that prevent cashing in on IPO/Acquisition.
Last place I had shares in prevented us from cashing them in until after 6 months had passed. Course there still hasn't been an exit event, so I still have a batch of worthless (for now) options sitting in a filing cabinet somewhere.
oh yes, it is an incredibly expensive share - current sales are about $268 million, and it's currently selling shares that value the company at $23 billion. That makes a P/E of 85, which is a teeny bit over-optimistic.
Like, most shares trade at about 15-20 times earnings.
Which means, as you own a little bit of the company, it'll take you 85 years before the company has sold as much ads as you paid, which manke syou think of those terribly overpriced tech boom stocks. Remember when Yahoo had a P/E of 133, with almost no profits? What is it today?...
Unfortunately, there's no data about Google's financials published yet, so you can only speculate on what the price will end up as - but if you base the share price on earnings, you'll get the idea that it can only go down. (which is another reason why this dutch-IPO hasn't gone down well, the professional investors think its overpriced too).
NASDAQ is reporting that Google shares will begin trading sometime between 10 AM and 12 PM EDT. IMO look for an opening between 10 and 10:30 AM EDT.
1) Offering up larger number of shares can have disastrous effects on the market cap of Google. If they issue too many and the prices get too low, their cap would be lowered undesirably.
2) 40 shares at a lower price, or 12 shares at a higher price, it still adds up to be the same. Only the Joe Shmuck investor thinks he got a better deal with his 40 shares vs. 12 shares. With that said, there are a LOT of Joe Shmucks out there, so it probably will have some effect.
eTrade SUCKS
P/E is price to earnings, which values GOOG at 118 times earnings for the last 12 months, actually in line with YHOO at ~ 114.
Futures pricing currently suggests that GOOG will close at around $92 at the end of the day.
Currently, however, trading is halted. This means there's such an imbalance in one direction or the other that it's impossible to put a price on the stock. I'd guess this has to do with the dutch auction method: maybe no one planned to flip the stock in the first day, or conversely maybe everyone who wanted stock bought it at auction. (I'd say the latter is more likely given they had to trim the number of shares they issued).
Tech sector IPOs aren't popular right now anyway, so this isn't necesarily GOOG's fault.
God when will people stop using that term incorrectly. Google did not raise $23 Billion with this stock offering, therefore $23 Billion is the market valuation, NOT the market capitalization. Market capitalization is stock price times outstanding shares, in Googles case that is significantly less that $23 Billion (in fact $1.67 Billion according to the article).
There are 4 boxes to use in the defense of liberty: soap, ballot, jury, ammo. Use in that order. Starting now.
The fact that only a minority of shares is being sold..