Back in 2014, I conducted analysis on Twitter. It turned out that Twitter ended up going the way of Groupon and Zynga, which has not been great for investors.
My original thesis from 2014 still seems to be be valid. Technology IPOs have shown some similarities in their post-listing price movement. They all seem to have gone through four phases: - Initial 'euphoria' with everyone trying to get their hands on the shares, and with analysts setting unrealistic expectations and justifying high valuations;
- A state of 'pessimism' after companies failure to meet the early unrealistic expectations, and a reduction in exposure by funds and institutions;
- 'Recovery and optimism' once the company starts beating the low expectations, and
- 'Realism' setting in, and the stock trying to find its fundamental value.
For the seven companies we analysed, the longer term chart shows how Facebook has been the real winner, even after a poor start in the first year after the IPO. Groupon, Twitter and Zynga have struggled to be anywhere close to the listing price after the initial euphoria period. Alibaba and Square are above their listing price but these are relatively early days.
| |
Ingen kommentarer:
Send en kommentar