IPO-INITIAL PUBLIC OFFERINGS
2006-12-31 16:47:47 · 6 answers · asked by ratheesh p 1 in Business & Finance ➔ Investing
good IPOs trading very cheap"
gayatri projects
parsvnath dev.
u can buy sobha dev. @ 900 level
2007-01-01 02:02:54 · answer #1 · answered by udayashanker k 3 · 0⤊ 0⤋
I did this once. I went to the SEC website and made a list of all the companies filing requests to sell stock to the public and tracked their success. (I did it in 2004 and studied all companies filing for public offering in 2003.) This is what I found:
It took an average of about 40 days for a company to begin selling after initially filing.
About 80% of those filing never went public.
Of those remaining, about 25% of the companies had considerably underpriced their stock and enjoyed at least 50% increase in price in the first 2 weeks.
25% of the companies had considerably overpriced their stock and lost half of their expected market capital within 2 weeks.
The rest had priced their shares at about what the market would bear and changed only a little over time.
Here's the deal with IPO's: they are nothing but untested stocks. No one has any idea what the market will bear as far as prices until each company has a track record.
(There are ways of applying a value to a stock based on how it's expected to pay dividends and how much income the company will generate, but the market is merciless, and the estimates often don't reflect reality.)
2006-12-31 21:04:08 · answer #2 · answered by Anonymous · 0⤊ 0⤋
If you are talking about IPOs in India, then there are many sites that tell you more about it.
I recently investigated the Cambridge Tech IPO by going to it's web site and reading their white papers. This gave me an idea of what they do and what they recommend. This told me that I need to invest since they do SOA successfully, and have done it for a lot of companies in the US.
So, we shall see how that works.
IF you are talking about IPOs in the US, then you should be reading the prospectus in detail first. The risk section is the most important one. If it is talked about a lot on TV and brokerage houses, and you have a chance to buy it from your broker, then ask him how shares you can have. If he is hestitating, I can tell you it is going to take off (higher probability). If he does not, cancel the order.
Hope this helps. I follow this advice, and when I do not, I lose money.
Take care.
KKP_Investor
2007-01-04 14:07:10 · answer #3 · answered by KKP_Investor 3 · 0⤊ 0⤋
There are several stategies...
DCF model
First, you must calculate the most recent FREE CASH FLOW of the company. Do a 10 year projection with appropriate growth rate! Then DISCOUNT them back using the discounted cash flow model to its present value (use Capital Asset Pricing Model as interest rate). The amount is the company's INTRINSIC value of a stock. then you can compare that amount with the IPO - you then are able to assess if the stock is underpriced or overpriced.
P/E ratio model
Find a comparable company's P/E ratio and multiply it by your company's earnings to find the required price to compare with the IPO.
Multiples
Find comparable company's EBITDA/Enterprise Value etc... multiplyit by your company's denominator. etc..
2006-12-31 23:57:36 · answer #4 · answered by VAVAV 3 · 2⤊ 0⤋
IPO's Happen every day -which ones would you like evaluated?
2006-12-31 16:52:15 · answer #5 · answered by canvasman 2 · 0⤊ 0⤋
Probably moneycontrol.com's ipo section would be a best companion for you in keeping updated on these regularly
2006-12-31 17:15:25 · answer #6 · answered by shreesha 2 · 0⤊ 0⤋