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"According to the S-1, you know, the ipo filing to the SEC, the max price for the IPO was $11.5 for 25.68 mln shares.
That was really a big stretch already, since the actual shares outstanding is close to 97 mln.
Essentially, the underwriters played an old trick that is really a clever game - they used only about 1/4 of the outstanding shares to do the IPO, so the net effect is that, short term, there is a shortage in shore float, and thus the big chase in stocks may be easily created and sustained for a while.
But every old timer knows you can't cheat the stock market in the long run - the stock markets always adjust to the fair value.
So, the big question for those suckers/(buyers and investors) is this:
What is the fair value of the stock in one or two years?
Using the factor of 1/4 by the age old trick of the underwriters of the Wall Street as a quick measure, the market cap will be reduced to $440 mln, and the stock will be reduced to $4.5, based on today's numbers.
That's why my $5 target.
So, congrats to all of you suckers who bought into the hype of the underwriters - the age old games of the Wall Street never fail.
"
This is from Yahoo board, so believe whatever you want to believe.
http://messages.finance.yahoo.co ... amp;frt=2&off=1 |
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