Google Goes Public at $85/share 343
adpowers writes "It is official. Google will have its IPO debut at $85 per share. To quote the article, 'At that price, the low end of its recently revised range, Google raised $1.67 billion, with $1.2 billion to go to the No. 1 Internet search engine and $473 million to Google executives and investors selling their shares.' Trading begins Thursday, August 19th." Got Google?
Finally! (Score:5, Funny)
Re:Finally! (Score:2, Insightful)
Besides what is your soul worth? Personally I didn't invest in defense contractors right after 9-11 although I know some people who did (and did very well at it.) Instead I gave away money to different charities, I will never regret that.
So sell SCO, give away money to a non-profit and get a
Happy days are here again! (Score:5, Funny)
Wrong Auction (Score:5, Funny)
This was the stock auction. The bankruptcy auction isn't for another few months, at least.
Weren't you alive five years ago? =)
was any /.er fool enough to buy at 85$ (Score:2, Insightful)
I remember Cisco used to be about 85$....
Re:was any /.er fool enough to buy at 85$ (Score:5, Informative)
I love it when people consider the cost per stock as an indicator of whether a company is overvalued. It is people like you who create arbitrage in the market for the rest of us to exploit...
Different companies have different number of stocks you know. $85 gives Google a total value of $23 Billion (market capitalization), while Cisco is still worth around $150 billion...
Re:was any /.er fool enough to buy at 85$ (Score:4, Informative)
Re:was any /.er fool enough to buy at 85$ (Score:3, Insightful)
If you really want google, wait about 90 days before buying it.
I live a couple of miles from Google HQ, so I'm bracing myself for the 500 new Hummers that the 500 new Google Millionairs will be driving!
Seriously, a big pile of money could prove to be a big distraction for the Google Rank and File. I hope the company stays on track.
Re:was any /.er fool enough to buy at 85$ (Score:3, Informative)
Ebay? (Score:3, Funny)
Re:Ebay? (Score:5, Funny)
(actual shipping charged to the buyer, negative feedback will be left, paypal only please, no international shipping, thanks for looking at my worthless crap, you are viewer number 0000000000000000001, sold as is, etc, etc, ...)
I'm more interested in... (Score:4, Interesting)
Re:I'm more interested in... (Score:5, Funny)
Re:I'm more interested in... (Score:2)
Lets see how they do: http://finance.yahoo.com/q?s=GOOG&d=t [yahoo.com]
Looks like the first bid was for 500 shares at 55$ but nobody dumped stock on that one. Should be an interesting day!
Re:I'm more interested in... (Score:3, Interesting)
Re:I'm more interested in... (Score:4, Interesting)
JWZ said that there are two kind of employees, those who want to work to make a company great, and those who want to work at a great company (paraphrased slightly because I'm too lazy to look up the exact quote). The millionaire employees who leave are likely to be in the first category, while the ones who replace them are far more likely to be in the second category.
Re:I'm more interested in... (Score:5, Informative)
Last place I had shares in prevented us from cashing them in until after 6 months had passed. Course there still hasn't been an exit event, so I still have a batch of worthless (for now) options sitting in a filing cabinet somewhere.
Re:I'm more interested in... (Score:5, Interesting)
Count your blessings. When I left a dot-com I was granted $120,000 worth of options. A couple of months later, in the next calendar year they were worth a fraction of that. The IRS made me pay income tax on the phantom $120,000 that I never got. Of course in order to PAY those taxes I had to sell all the stock at a fraction of "what the company gave me". In return "to be fair" the IRS gave me an equivelant amount of 'capital losses' I can write off in the future. Now if I ever make $120,000 in capital gains in the future I will get back the money the IRS stole from me.
Re:I'm more interested in... (Score:2, Informative)
And not the IRS didn't steal any money from you.
Re:I'm more interested in... (Score:3)
Look them up along with AMT (alternative minimum tax).
Re:I'm more interested in... (Score:3, Interesting)
No you don't.
An option is the right to by a stock at a fixed price. Exercising is the act of BUYING the stock at that fixed price, it has nothing to do with selling the stock. I exercised options 7 years ago and I still own the stock
I was in a similar situation a few years back with a company I had options that had to be exercised prior to my departure, so I bought the shares at the price indicated by the options. That year, I had to pay tax on th
Re:I'm more interested in... (Score:2)
Hedge your position (Score:2, Informative)
Re:Hedge your position (Score:4)
It is not illegal to trade options on a company that you work for. However, you do have to follow insider trading guidelines. Generally if you hold shares for some amount of time (probably six months), or document your planned buying and selling six months in advance you are fine. The SEC is fine with you investing with the knowledge that your company is set to go up or down in value in general. What they don't like is that you found out about a merger which won't be announced for a week and going out and buying/selling the stock in the meantime.
Giving that knowledge to a friend is also illegal (Martha Stewart comes to mind). All telling a friend might accomplish is making it hard to trace.
However, if somebody seems very lucky on the stock market, the SEC does investigate and if you're caught you're toast. Especially if you aren't rich enough to get special treatment...
Re:I'm more interested in... (Score:3, Insightful)
Don't blame the IRS, blame Congress.
Disappointing (Score:3, Insightful)
Re:Disappointing (Score:2)
Could you vote for Google management before the IPO? No? Then what the hell did you lose?
Re:Disappointing (Score:3, Funny)
Re:Disappointing (Score:5, Funny)
You keep using that word. I do not think it means what you think it means.
Re:I'm not sure (Score:4, Insightful)
The initial estimates of their price created such hype and talk -finally it deflated, by a good amount (IIRC the initial estimates were up to 120 per share?).
I remember reading the articles last year, prior to Google going IPO - saying how important this would be to our economy - how Google would save the stock market with all the trading fee revenue, etc... And then came the articles that Google doesn't want to IPO - they want to remain "pure" and "uncompromised" by not having a board of directors and shareholders who would force them to become "evil." In the end, it was a great marketing strategy - playing "hard to get."
If anything, the whole ordeal tired me out and now that the time came, I feel more blah then what I should. Hmm maybe it is because its a "blah" morning for me - but I expected something more cool when I hit Google website - anything - throw the comman person (who won't spend 85/share) a bone
Those are my feelings - I do not expect many people to agree with me - but then, that is why these are feelings (opinions).
Thanks for listening
Still a good valuation (Score:5, Insightful)
Re:Still a good valuation (Score:2)
Re:Still a good valuation (Score:4, Insightful)
Re:Still a good valuation (Score:4, Informative)
The fact that only a minority of shares is being sold..
Re:Still a good valuation (Score:2)
$1.2 B to go to the No. 1 Internet search engine (Score:5, Funny)
Re:$1.2 B to go to the No. 1 Internet search engin (Score:3, Insightful)
Scoffing Analysts (Score:5, Interesting)
I, for one, would be lost without it. However, I will be interested to see how it develops now it's under external influences.
Re:Scoffing Analysts (Score:2)
Re:Scoffing Analysts (Score:3, Interesting)
Perhaps, but allow me to provide a counter example.
Evite.
At least at one point, I was receiving Evites every day or so for this or for that. And I'd look at the page, so I guess that means I was using it. I still don't think it provides a useful product, or provides genuine value. (Though obviously some other people do.) Probably the only reason that they're still around at all is
Re:Scoffing Analysts (Score:4, Insightful)
Mind you, I think Google is a great tool, but they've bungled this IPO pretty badly. Whether they can continue to innovate and grow as a company is an open question that will be interesting to follow over the next few years...
Re:Scoffing Analysts (Score:4, Insightful)
I know a company that when call volume is low they simply up their cost per click on Google for a couple of hours, spending about $1000, and they have work for the next month. Google ads really work.
For my business, we landed a small contract for some communication line installations from posting an ad on Google. We spent about $60, and received just under $500 in billable services. We are currently working on an ad campaign for Google for some custom software. We will be making Google our only advertisement medium.
Re:Scoffing Analysts (Score:4, Interesting)
Seems they have done better than most, at least by the only measure of success that is important to the company. They will have gotten a much larger share of the potential IPO revenue than companies that take the usual route and have the investment banks divvy up the shares amongst their buddies with big kickbacks and fees. Sure they had a few well publicized mistakes, probably well publicized by the people that would loose out if this method of IPO became popular.
The message that the investment banks want other companies to take from this is that only google can hold a dutch auction and get away with it, for the rest of the companies they should let the pros handle an IPO in the usual way, even though half the IPO revenue will get pocketed in kickbacks and fees. The middlemen are always afraid when they are bypassed and are sure to point out everything that went wrong, even when this result was better for Google and better for investors.
Re:Scoffing Analysts (Score:2)
Glad to see it came down. (Score:2, Interesting)
At any rate, now I can get my one share [singleshare.com] framed! I like to keep all my favorite tech company's stock certificates on my computer lab wall. :)
Anyone? (Score:5, Funny)
No? Just me.
Media missed boat on WHY share price went downward (Score:5, Insightful)
I think that's about it. Nothing very complicated at all...
Prove it then (Score:5, Insightful)
Re:Prove it then (Score:3, Informative)
Re:Prove it then (Score:3, Interesting)
Re:Media missed boat on WHY share price went downw (Score:2)
Agreed (Score:2)
Once again, Google is flexing their mental might.
Re:Media missed boat on WHY share price went downw (Score:3, Insightful)
Those people have no business playing in the market, then. Auction theory is in second semester economics here at UMD@CP, including the exact variant that Google is using.
Anyone who gets in at $85 is going to get burned once rational valuation kicks in. We should be thankful it went lower. I've read that most institutional investors are staying far, far away from this one - that's pretty telling, in my eyes.
Geek cred != market cred.
-Erwos
At almost half-price... (Score:2, Funny)
It must be so demoralising for them
Jaj
In no way bitter.....
Beta? (Score:4, Funny)
Some good here (Score:5, Interesting)
The lower per share value was followed by a lowering of shares available. This could generate more interest in the shares, which will drive prices up (or keep them constant longer).
It does, however, mean the cap has gone down by over 25% (36B to 26B). Still bigger than my bank account, though.
Re:Some good here (Score:2)
They wanted to sell X shares at Y price, and after getting all the bids in, they scaled back to selling 1/2X shares at 2/3Y. That sounds like the market demand was much less than they anticipated, and the revision is an attempt to spin things in a positive fashion going forward...
Re:Some good here (Score:2)
And a couple of early investors pulled their shares to sell because they think that they can sell them in the future at a higher price. Nothing better than seeing that sort of confidence in a company's stock price.
Some analysis (Score:5, Informative)
The Beginning of the End? (Score:5, Interesting)
Maybe the problem is the following: there is a way in which Google is perceived now that is fundamentally wrong. It is treated as a "service" for Internet Users, the One and Only Search Engine, while it is just Yet Another Company.
Monopolies (especially privately-owned and profit-making ones) are never good. Will Google become as Bad(TM) as Microsoft?
Re:The Beginning of the End? (Score:2, Insightful)
One of the reasons that they've done this (as state in their S-1 registration statement) is to prevent the pursuit of short-term profits at the exp
Re:The Beginning of the End? (Score:2)
I doubt Google is a monopoly, and there are other search engines vying for the top spot should Google mis-step. If they sell out to shareholders and Yahoo or MSN ends up being more useful as a result, then the shareholders are only hurting themselves.
My understanding is that only a small portion of shares are being sold, so those votes do
Money for buyouts? (Score:5, Interesting)
Re:Money for buyouts? (Score:4, Insightful)
Bit expensive, isn't it? (Score:5, Interesting)
Microsoft are starting to consider Google as competition. And competing with Microsoft has historically been a bad move - I can see Longhorn's search facilities integrating with MSN search such that the boundary between the Internet and the PC on your desk becoming blurred. Google are pretty much at the top, and it'll be almost impossible to maintain that long-term.
So you probably wouldn't buy this share for growth. How about income? Has Google publicised what it plans on offering in dividends? Even if it did, with no past record to go on, how can you have any idea what level of income to expect?
Even if you don't buy the share for growth, it's still an expensive share. It wouldn't take much for its value (and thus the value of the investment) to plummet.
Ultimately, I think this share is a bet that the rich might be prepared (and financially able) to take, but most would be well advised to steer clear of. The dot-com bubble burst a long time ago.
Re:Bit expensive, isn't it? (Score:5, Informative)
Like, most shares trade at about 15-20 times earnings.
Which means, as you own a little bit of the company, it'll take you 85 years before the company has sold as much ads as you paid, which manke syou think of those terribly overpriced tech boom stocks. Remember when Yahoo had a P/E of 133, with almost no profits? What is it today?...
Unfortunately, there's no data about Google's financials published yet, so you can only speculate on what the price will end up as - but if you base the share price on earnings, you'll get the idea that it can only go down. (which is another reason why this dutch-IPO hasn't gone down well, the professional investors think its overpriced too).
Re:Bit expensive, isn't it? (Score:2)
Rought, Roh, Shaggy!
Re:Bit expensive, isn't it? (Score:3, Informative)
P/E is price to earnings, which values GOOG at 118 times earnings for the last 12 months, actually in line with YHOO at ~ 114.
Futures pricing currently suggests that GOOG will close at around $92 at the end of the day.
Currently, however, trading is halted. This means there's such an imbalance in one direction or the other that it's impossible to put a price o
Re:Bit expensive, isn't it? (Score:4, Insightful)
This is a bit of a meme, and I believe and incorrect one.
Sure, when the PC market was rising Microsoft did really well agressively bagging the OS and Office application markets.
However, it's not been very good moving into established markets, and for a while hasn't even been very good at bagging new, rising markets.
They said they would kill AOL. They didn't even get close. They said they would dominate the software for mobiles market. They haven't. They said they would beat Sony in the game console market, but they haven't.
Once upon a time, everyone in the industry feared Microsoft. Those days are over.
Re:Bit expensive, isn't it? (Score:2)
I think Google would be easier for Microsoft to compete with than most. Not that Microsoft would crush them easily, just that Microsoft can compete with Google pretty well, using some pretty nasty tactics.
My reasoning is this: Like it or not, Microsoft has a pretty effective stranglehold on most of the clients used to a
Re:Bit expensive, isn't it? (Score:3, Funny)
You are forgetting MS is now officially a monopoly. Their legal problems have changed the way they do business. They can't be as nasty as they used to be.
Wrong Link (Score:4, Informative)
Re:Wrong Link (Score:2)
Don't Be Evil... Until the IPO (Score:2, Funny)
At least, that's what I'd do with that kind of money. That and loose women.
Not at this price (Score:2, Insightful)
Not only that (Score:2)
Re:Not only that (Score:2, Funny)
Don't buy a cent. (Score:5, Interesting)
1) By all fundamental measures, this stock is dramatically overpriced. (Ask yourself how a search engine -- which could likely be replaced by next years' "next new thing" -- could be worth, on a per cap market basis, as much as McDonalds.)
2) IPOs usually only make one group of people rich: the boardroom execs. Don't be suckered by the initial rise in price -- IPOs are almost always followed by a dramatic downturn.
Re:Don't buy a cent. (Score:2)
In Google's case, the IPO followed the Dramatic Downturn.
Re:Don't buy a cent. (Score:2)
Re:Don't buy a cent. (Score:3, Interesting)
Oh really? Is that how they plan on making $250M this year on $3B of revenue for 2004? How do I buy or rent this product that they are selling? Google's technical infrastructure is novel and very interesting, but it's a cost-reduction measure and not a source of revenue. Seeing how they make money, they're an advertising company more than anything else. But you
Useless (Score:2)
Re:Useless (Score:3, Informative)
I don't understand WHY Google IPO'ed.
As I recall comments from the initial announcement, Google had grown enough that they had to start filing stuff with the SEC like a publicly traded company (which costs lots of money in overhead) anyway, so they decided they might as well go the whole nine yards and raise some money too. Or at least that was one hypothesis.
$85 is awfully high (Score:3, Insightful)
Re:$85 is awfully high (Score:4, Informative)
2) 40 shares at a lower price, or 12 shares at a higher price, it still adds up to be the same. Only the Joe Shmuck investor thinks he got a better deal with his 40 shares vs. 12 shares. With that said, there are a LOT of Joe Shmucks out there, so it probably will have some effect.
Smart people get rich (Score:2)
Google wasn't original but it did search significantly better. Created interesing products that worked well. Now the payoff.
They deserve it.
Google to open between 10 AM and 12 PM EDT (Score:3, Informative)
Classic over-hyped bubble (Score:3, Insightful)
Give me a good solid energy or pharmaceutical company or something with a steep demand curve, naturally limited supply and customers who gotta have it (like sickly suv owners).
Actual company value (Score:2)
But, as any idiot knows (I know, I am an idiot...) the value of anything is marginal. House prices are only high so long as there is a shortage. If everybody suddenly panics and wants to sell, houses get cheap very quickly. This is economics 101
Re:Actual company value (Score:5, Insightful)
>why the SEC allows this practice?
I assume that this is the heart of the question.
The purpose of SEC is not to determine if a share of a company is fairly priced or not. Thats your job.
heaps-o-cash (Score:2)
I suppose Google employees are also able to buy Google shares on the market and ride them up, but mostly I'm curious about w
Price guaranteed to go lower (Score:3, Interesting)
Re:Price guaranteed to go lower (Score:2)
No it does not. You are forgetting about all the people outside the USA who were unable to participate in the auction, the many people who did not meet their brokers eligability requirements and the people who failed to get a bidder id.
I'm not saying it won't go down, there are plenty of other reasons for it to fall.
Cheaper than you think (Score:3, Interesting)
If the original amount of shares had been offered to the public, bidding would have continued well down past $85 to a range of $50-65 per share or so. In other words, for all practical purposes Google went public at half the price they had predicted. Interestingly, at that price Google's valuation is more in line with its competitors (overture, yahoo).
Keep in mind that most companies that go public aim for a $10-20 per share initial price. This suggests that when the Google IPO process got started, Google was expecting to get a lot less per share than they got, so in the end they should be more than happy.
Google's PR mistakes (Score:3, Interesting)
Whether it was a questionable interview with Playboy by company founders that almost derailed the IPO or the failure to properly account for stock options, Google's missteps have been high-profile and surprisingly amateurish. Google's brand with consumers has not suffered as a result, but in the media, the company's respect level is at an all-time low.
--
The PR people at Google, I have no doubt, are well aware of the challenges they face in going from a privately-held company to a publicly-held company. Up until a few months ago, I had faith that the company could handle these challenges without much fanfare or problems. But in light of recent events, I'm more skeptical about how the company conducts itself with the media and public at-large. Perhaps Google was just too perfect for its own good.
decline of Slashdot (Score:3, Funny)
Re:decline of Slashdot (Score:5, Insightful)
Jonny, tell him what hes won....
Re:decline of Slashdot (Score:3, Insightful)
Wouldn't of surprised me at all if it had gotten rated "+3 Insightful"...
Re:Financial sites with trading info (Score:2, Interesting)
Re:Run (Score:2)
Take the money and run. Google is too risky anyway. A search engine that doesn't offer anything new."
Idioteque by Radiohead?