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Technology Stocks : Avalon Group, Inc.

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To: Madeleine Harrison who wrote (1112)5/15/1999 12:09:00 AM
From: X-ray Vision  Read Replies (2) of 1530
 
Mads, IPO pricing is done by standardized formula:

[(Projected EPS as a mature corp.)x (# of underwriters/(1/underwriters reputations )) x ( brokerage hype + media hype) x ( current internet mania quotient)] divided by 2. The final denominator ensures that the IPO doubles out of the box, making the underwriters look like geniuses, worthy of their usurious 7%. Hope that puts things in perspective.
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