Its SHOWTIME: Facebook IPO Is Coming Soon To A Portfolio Owned By You


After much speculation and anticipation, the Facebook IPO is just around the corner.

According to the Wall Street Journal, Facebook could file the necessary paperwork as early as next week, seeking to raise as much as $10 billion. The valuation of the social media giant is expected to be no less than $75 billion and possibly as high as $100 billion. To give an approximation, this would make Facebook’s market cap equivalent to Abbot Laboratories or McDonald’s.

Morgan Stanley Beats Out Goldman

Morgan Stanley (NYSE: MS) will be leading the deal, with Goldman Sachs (NYSE: GS) taking on a syndicate roll. Although, Lloyd Bankfein, the Goldman CEO, was reported to actively court Facebook board members to be the principal agent on the offering, Morgan Stanley simply has more experience with Internet IPOs.

Morgan Stanley was the lead underwriter on the three largest internet IPOs of 2011: Groupon, Zynga and LinkedIn. Nonetheless, Goldman is reported to play a major role in the Facebook deal, which will ensure a sizable piece of the $220 million fees estimated to be paid to the banks.

Not Another Tech Bubble

With Facebook (and Yelp) going public this year, 2012 will mark the second largest year of U.S. internet public offerings since 1999, when $18.5 billion was raised for web-based firms. With the resurgence of tech companies going public, pundits will hail that we are entering another tech bubble similar to the 1995-2000 era when worthess dot coms attracted millions of venture capital funding only to go bust shortly thereafter.

There are a couple key differences, however, between the rise of internet companies today and those starting up in the mid ’90s. Firstly, the dot com bubble was fueled by unrealistic valuations attached to companies that did not have a business model or a real plan – they just had a domain name and a dream. Everyone just assumed that revenue and earnings would simply follow.

Today’s companies and the broad investment landscape are very different. Although LinkedIn (NYSE: LNKD) and Groupon (NASDAQ: GRPN) have seen their share price plummet by 20% and 25%, respectively, after going public and Zynga (NASDAQ: ZNGA) failed to attract its desired level of attention as its stock price fell on the first day of trading, these companies actually have sustainable business models and signs of growth.

Groupon, for example, saw 426% growth between 2010 and 2011. Although I am bearish on the stock, it’s not due to its balance sheet or lack of earning, but more so due to the heated competition in the social buying space.

LinkedIn caters to a growing internet niche and has likewise shown 116% year-over-year growth in Q3.

Zynga, which is actually up 5% after going public, realized quarterly year-over-year revenue growth rates of 251%, 141% and 115% over the last three quarters.

When these companies become more established, healthy earnings will follow.

Secondly, with the dot com bubble still fresh in investors’ minds, the flow of capital is subject to more scrutiny than before. Sure, there are dozens of start-ups gaining access to venture and angel capital on an almost weekly basis, but they are not awarded the same valuation as those that emerged during the dot com bubble.

Facebook-Google

Facebook, with 800 million active users, has become a utility of sorts used by businesses, students and the common public for day to day interactions.

Since the name “Facebook” conjures up the same level of recognition as “Coca-Cola” and “Apple”, the Facebook IPO has even more hype around it than when Google went public in 2004. Google’s stock jumped 31% on its first day of trading and has continued to outperform the market following its debut.

Will Facebook be able to do the same?

Source: Motley Fool

Like Us On Facebook

Interested to find out more on the 2012 Facebook IPO?

Like us at http://www.Facebook.com/AimHighProfits for continuing coverage up to the Facebook IPO launch date.
*****************************************************************************

Would you like to receive the #1 rated penny stock newsletter?

If you answered yes, then receiving Aim High Profits Penny Stock Alerts will help guide you to some of the biggest and most profitable trading alerts and techniques that are proven to bring in the “big bucks“.

Visit http://www.AimHighProfits.com to find out more. Alternatively, click here to get more Penny Stock News.

You just have to do your due diligence to stay away from all the scams out there these days!

***Reminder: never chase stocks that gap at the open and always protect your profits!

AND AS ALWAYS…………..

  • Do your own research.
  • Trade Responsibly.
  • Verify everything.
  • Move Fast or Get Left Behind.
  • Do not use market orders to enter a position, use limit orders.
  • Have a System That fits You.
  • If a Stock Gaps Open, Look for Pullbacks to Enter.
  • Plan a Trade and Trade a Plan.
  • Always use stop loss orders to protect yourself.
  • Positive Self- Belief.
  • Keep trading as Part of a Balanced life.
  • If a stock breaks below our alert price GET OUT. Do not wait.
  • View Trading as a Score in Points and Not In Money:
  • Always take your profits whenever you can. Do Not Be Greedy.
  • Work Hard at Learning How to Trade Properly and Keep Working.
  • Do something to make someone else’s life better today.

Good luck in making the Best Penny Stock picks.

2012 – Become a Millionaire!!

Advertisements

Got Something to Say or Add......

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s