Initial Public Offering Paper - Essay Example

Only on StudentShare

Extract of sample
Initial Public Offering Paper

In this case, even after the IPO, Del-Ta Engineering is still the controlling shareholder by virtue of its shareholders agreement with David Rivel (Initial Public Offerings (IPO): RRSAT Global Communications Network Ltd. n.d.).
IPOs have positive initial returns on average. This is the phenomenon of underpricing (Ross, Westerfield, and Jaffee, 1996). For example, at start of the first day after the RRSat Global Communications Network Ltd., the shares were 12.16% [($14.02 - $ 12.50)/$12.50] above their initial offering price. At the end of the first day, the shares were 20.24% [($15.03 - $ 12.50)/$12.50] above their initial offering price (RRSat Global Communications Network Ltd. n.d.).
The present value of the first three payments comprises a significant portion (20.73%) of the price of stock. This can be explained by the time value of money. A dollar now is worth more than a dollar in the future.
a. High-risk companies. High-risk companies are expected to distribute a relatively low proportion of current earnings and have a relatively low PE ratio. A high-risk company is likely to retain more of its earnings as the probability of bankruptcy is higher. ...Show more


c. Ownership and control become more disperse. Before the IPO, Del-Ta Engineering is the direct beneficial owner of 46.64% of its outstanding shares and may be deemed the beneficial owner of a total of 67.55% of its outstanding ordinary shares by virtue of its shareholders agreement with David Rivel, its Chief Executive Officer and a principal shareholder…
Author : olsonmelvin
Save Your Time for More Important Things
Let us write or edit the essay on your topic
"Initial Public Offering Paper"
with a personal 20% discount.
Grab the best paper

Related Essays

Initial Public Offering (IPO)
Under priced situation is a short run phenomenon as the market price will come close to intrinsic price when the demand for under priced securities goes up. When an IPO is under priced, the initial market return will be high. Thus, it can be interpreted in another way, i.e., high initial return.
8 pages (2000 words) Research Proposal
Proposal Argument PRATICAL PROPOSAL offering a solution to a local problem.
A woman as they say is God's greatest creations. She plays many roles in her life, one leading to the other. A sad thing is that she is never completely independent though my feminist counterparts would say otherwise. However much women struggle to prove their mettle in all spheres of life they remain second grade in being credited with accolades so much so that even their pay is not commensurate with that of men.
4 pages (1000 words) Essay
Nursing Research Paper PICO formated question
Heated discussions among those having opposing viewpoints on disclosure issues are not uncommon and the passion surrounding such debates is fueled by the culturally embedded nature of the issue. In very broad terms, differences in disclosure preferences can be somewhat delineated according to Eastern or Western philosophical orientation (Field and Copp, 1999).
6 pages (1500 words) Research Paper
Managing Strategically in The Public services
The strategic perspective considers the organisation in its external environment; it aims to specify clear goals and objectives; it attempts to move away from routine management tasks to consider, in a systematic way, longer term considerations of the very future of the organisation.
19 pages (4750 words) Essay
Initial public offerings corporate finance 501 case assign 1
ype of investors that Skype can attract using the style of IPO and the lesson that is learned from Google and Morningstar for the auction IPOs that they conducted. The paper also discusses the costs and risks that are involved for each type of IPO are also discussed. E – Bay
4 pages (1000 words) Essay
Initial public offering (federal express) session long project module 1
The company employees as many as 140,000 people worldwide and the company have recorded sales of $35,497.0 as of 2009. The company has earned a gross profit of 25,254.0 as of May 2009. The company is led by Fredrick Smith, the Chairman, President and CEO. The major
2 pages (500 words) Essay
Find out how much would it cost
to get a custom paper written by a pro under your requirements!
Win a special DISCOUNT!
Put in your e-mail and click the button with your lucky finger
Your email