Comments on: How well is Goldman serving its IPO clients? A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 By: HBC Sat, 17 Jul 2010 23:05:54 +0000 If you’ve got the time and money it takes to cleanse the stench of corruption out of doing a deal with Goldman Sachs, you definitely have the wherewithal to think twice about doing business with them in the first place.

By: CDNrebel Thu, 15 Jul 2010 16:56:53 +0000 I think GS priced it just right; It’s been above the IPO price four days (five included today Jul15) and below six days. Maybe it was a touch underpriced – maybe – but the dangers of overpricing are far more perilous, re Athabasca Oil Sands IPO a couple months back. Investors don’t really even wanna touch it anymore even though it’s a solid corp b/c it’s off 35% from the IPO. I have to agree this articles reeks of an attempt to jab at GS; they’re not doing God’s work but they’re not the devil either.

By: davew Thu, 15 Jul 2010 14:43:09 +0000 So more cash in the bank is worth less than the pleasure of watching your stock price go up?

That’s ridiculous.

By: fxtrader14 Thu, 15 Jul 2010 09:44:23 +0000 Every now and then there’s data from BBG, thomson reuters or dealogic which shows the “best” and “worst” underwriters of IPOs based on 1st day pop, 1 month or things like the difference between the announced pricing range and the eventual IPO price.
It’s very easy to draw conclusions out those figures but anything more than tentitative insight is pointless. These figures will ignore whether the company is tech or utilities for example – and even in non-dotcom times has an impact because most companies in “tangible” sectors are fairly easy to value, whereas in tech it’s much more a guessing game.
Then of course, the size of the company matters greatly and so the % put for sale. If you were to sell, say only 5 or 10% of GM and AIA, 2 huge Cos, then assuming an average price, you’ll likely engineer a significant pop. Yet, the gov will want cash back, so you prob have to sell 30% or 40 or maybe even more of those companies – which means you pretty much have to stuf all your accounts with that paper. So the nbs of investors not long and keen to buy when it trades will be a lot smaller.

I could go on – the point is that they are so many variables that it a ridiculous thing to do to write such articles based on that kind of data. But equally, banks are pitching using that very same kind of data – and that is just equally ridiculous. The sad thing is that CEO and company owners tend to buy that sort of BS…

By: Danny_Black Thu, 15 Jul 2010 06:34:28 +0000 Ah the gratitious anti-GS spin. Am guessing hits for the week must be down.

I have absolutely no doubt that had the IPOs been tanking instead then you’d be bitching about how clients are getting screwed by GS in favour of their corportate clients. I am guessing the only way GS has truly win your favour is if every IPO they do stays absolutely flat.

Also it is generally considered by the companies too that “a pop” in the price is a “good thing”. You are also confusing companies desires with the desires of the people who are selling their stock in the IPO.

By: Setty Thu, 15 Jul 2010 00:29:27 +0000 As long as you’re following the money, recall who pays Michael Tsang’s salary. Every thousand terminals at Goldman Sachs equals about $20 million a year in revenue for Bloomberg. It adds up.

By: Greycap Wed, 14 Jul 2010 23:00:27 +0000 IPO underpricing is a universal phenomenon – there’s nothing about it that’s specific to GS. Your analysis of whose interests are served by this is dismally incomplete.

As it happens, the Psy-Fi blog recently posted a good summary of the issue: -bitter-lemons.html; you would profit by reading it.

If that seems too onerous, here is a quote that identifies one weakness in your position:

“… potentially, it’s actually in the interests of the company owners to see the stock price roar away on the first day, especially if they’ve retained significant amounts of stock. So the people most likely to complain about the process may also have the most to gain from it.”

There is also a link to a table of “excess” IPO return since 1990 in the article that you may find interesting. Here it is again for your convenience: Os2009Sorts.pdf.

By: MishGEA Wed, 14 Jul 2010 22:41:04 +0000 Hey Felix
shoot me an email
want to discuss something