Discussion Thread: Initial Public Offering

 

Module 4: Week 4 Introduction

Overview

While the calculations used to determine the valuation of a company are important, translating these calculations into an understandable report is also valuable. It is equally important to understand that components of a valuation report, as well as the business valuation standards that govern valuations. 

Learning Outcomes

Upon successful completion of this module, you will be able to:

• Identify business valuation standards.
• Recognize various components of a valuation report.
• Calculate formulas that go into a valuation report.

 

Read: Hitchner: Chapters 11 – 12

 

Watch: Standards & Writing

https://canvas.liberty.edu/courses/934965/pages/watch-standards-and-writing?module_item_id=101647608

 

Watch: Initial Public Offering (IPO) Explained

https://canvas.liberty.edu/courses/934965/pages/watch-initial-public-offering-ipo-explained?module_item_id=101647610

 

Discussion Thread: Initial Public Offering

An initial public offering (IPO) is the process of a company selling its shares to the public for the first time. IPOs are typically used by young companies to raise capital for future business expansion. These shares are initially issued in the primary market at an offering price determined by the lead underwriter who usually organizes the syndicate of banks and brokers (depending on the size of the offering).

Underwriters take on significant financial risk when they commit to an IPO. If the market is not interested in the offering, then the underwriters may be stuck holding securities nobody wants. On the other hand, A strong IPO can lead to very high gains and can allow investors early entry into a hot stock.

For this assignment, research a publicly traded company that recently (within the past three years) went public through an IPO (initial public offering). Discuss the estimation of the company’s stock price prior to the actual IPO date, the price of the stock on the date of IPO, the price shortly after, and the current price. Reflecting on what has been learned so far, discuss whether you believe the initial estimation of value was accurate and why or why not.

DISCUSSION ASSIGNMENT INSTRUCTIONS

 are required to submit a thread of at least 450 words in response to the provided prompt for each

forum. For each thread, you must support your assertions with at least two (2)

scholarly/professional sources (note that Investopedia and Wikipedia are not

scholarly/professional sources). Your sources MUST be cited at the end of your post using

proper APA format.

In addition to your original thread, you must reply to at least two (2) classmates’ threads. Each

reply must be at least 250 words. Do not just say “good job” or “I learned something from your

post.” Replies are not a cheering exercise. Instead, your replies must be substantial, reflecting

what you learned from reading the post, offering an extension, or correcting a mistake. Use what

you learned in researching for your post (or knowledge gained from other classes or personal

experience) to either supplement or critique the post you are writing about. You do not have to

include any references for your replies.