For all the hype, most retail investors weren’t buying in, and it took some alleged buying on the part of the underwriters to keep the stock from losing on opening day.
By Howard Gold
Facebook's (FB) much-hyped initial public offering started out with lots of hope, but it ended with a thud. The stock barely closed above the offering price of $38 a share -- and only after the underwriters reportedly bought up enough stock to keep it in the plus column.
Why? There were four reasons.
Has Facebook reinvigorated the IPO market? Here are a few tech companies racing to go public -- and what you should know about them.
By Eric Markowitz
On Friday, Facebook (FB) raised a record-setting $18 billion in its IPO, placing its value at a staggering $104 billion. Not bad for a start-up founded just eight years ago in a 19-year-old's dorm room. While the company's IPO has helped plenty of its investors get very rich very fast, it has also set the scene for several other companies to go public.
In the last year, there have been several Silicon Valley darlings to go public; Yelp (YELP), Zillow (Z), Pandora (P), and LinkedIn (LNKD), just to name a few. Facebook's IPO will certainly cast a long shadow against the next wave of tech companies waiting to hit the markets. The question, of course, is whether the IPOs will live up to their hype.
Even though it has never been in the black, the popular scrapbooking site secures $100 million in new financing.
Pinterest, the popular social-media site that allows users to "pin" images from the web on a virtual billboard, has secured $100 million in new financing, a deal that values the company at a cool $1.5 billion. While that's well short of Facebook's (FB) $100 billion value, Pinterest's new investors apparently believe that the site, which has never turned a profit, can transform itself into a money-making machine. Revenue often seems like an afterthought in the tech world these days -- just think of Facebook's $1 billion purchase of the business-model-less photo app Instagram.
Does Pinterest actually have the potential to be a cash cow?
The search giant, up 7% since February, is benefiting from a halo effect, one expert says.
By Jonnelle Marte
While Facebook (FB) nabbed the lion’s share of media attention heading into its record-setting IPO on Friday, an older Internet giant’s stock was quietly rising.
Google (GOOG) shares have jumped more than 7% since Facebook filed for its initial public offering on Feb. 2, while the Standard & Poor’s 500-stock index is down about 1%. How to explain this market-beating performance? Some analysts say Google is likely benefiting from the hype surrounding Facebook -- and the inability for most regular investors to get in on the IPO at a decent price. It’s also seen as an attractive option for tech investors who can’t stomach the risks of investing in newly public companies, says Devin Pope, a wealth adviser for Albion Financial Group in Salt Lake City. "Google is a way to get exposure to social media without the risks and some of the potential unknowns from a company like Facebook," he says.
So who’s buying Facebook shares as the insiders sell? A lot of shares go to mutual funds and pension plans, which means they may be in your portfolio already.
By Merrill Goozner
Everybody is ogling the fortunes being made from the investors and owners cashing out at Facebook (FB) -- Mark Zuckerberg taking $1.1 billion, Goldman Sachs (GS) taking out nearly the same, and Peter Thiel of PayPal collecting nearly $600 million.
Their good fortune raises an obvious question. Who’s buying? Who is plunking down the estimated $6.5 billion for the 180 million public shares that hit the market today? (The rest of the 421 million publicly registered shares will be conversions from the private stock held by insiders, venture capital firms and institutional investors -- the private parties who owned Facebook before the initial public offering.)
If you are looking to join huddled masses yearning to enrich the real friends of Facebook, there’s no need to make a frenzied call to your broker. You probably already own shares. And whether you want to or not, you are about to own a lot more.
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[BRIEFING.COM] The Russell 2000 crosssed the 1,000 level for the first time ever today and the S&P 500 established a new all-time, intraday high. Those were some of the more memorable highlights of what was an otherwise nondescript day of trading.
By and large, there just wasn't a lot of conviction on the part of either buyers or sellers. The major indices spent time on either side of the unchanged line, but never put a whole lot of distance between themselves and ... More
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