An initial public offering (IPO) or stock market launch is a
type of public offering where shares of stock in a company are sold to the
general public, on a securities exchange, for the first time.
Can you make a fortune investing in an IPO? Absolutely!
Can you lose a fortune investing in an IPO? Absolutely!
Glad I cleared that up.
It's always easier when dealing in absolutes.
I never will call a pound sign (#) a hash tag, but with the
news that Twitter will soon join the fun at the NYSE or NASDAQ, I guess I could
adjust. I won't go into the details of
why I think Twitter will actually be a great investment; just google (it's a verb now) "Twitter
IPO" and sort through the pros and cons.
You still have plenty of time to decide if Twitter, stock symbol: ????
or ???, will fall into one of the three categories listed below.
The Good
The only way to make it into this elite group is to approach
the "10-bagger" status... an investment
that appreciates to 10 times its initial purchase price.
Whole Foods Markets (WFM): 1000%
growth in just over six years.
Qualcomm (QCOM): 1000% growth in six years
Express Scripts (ESRX): 1000%
growth in four and a half years.
Wellpoint Inc.(WLP): 1000%
growth in four years.
Starbucks (SBUX): 1000% growth in three years.
Yahoo (YHOO): 1000% growth in two years.
Amazon (AMZN): 1000% growth in
one year.
Ebay (EBAY): 1000% growth in six
months.
Google (GOOG): a meager 900%
growth since it's 2004 debut.
The Bad
For the "bad", words
don't do the stock performance justice...
Shanda (GAME)
Blackstone Group (BX)...where getting back to even would be a
victory.
And then there are the
"dot.coms"...Pets.com, Webvan.com, Kozmo.com, eToys.com, just to name a few of the dear departed. Consider your investment the price of an
education in the subject of what not to invest in.
The Ugly
Well, I'll just put a recent one (Facebook) into
this category. Ugly, yes, but maybe if
we slap enough lipstick on this pig...
Data provided by Bloomberg.
