News / USA

Facebook To Raise $5 Billion From Initial Public Offering

Facebook is going public. The world's largest social media network filed documents late Wednesday for its much anticipated initial public offering (IPO).  Analysts say the initial offer will raise about $5 billion in the first go around, making it one of the biggest in recent history.  We take a look at how much the company is worth and what that could mean for investors.

With more than 800 million users worldwide, Facebook is second only to Google as the most visited website on the Internet.
But with plans to raise an initial $5 billion from its first IPO, analysts say the company is poised to become one of the richest.

Equity analyst Anupam Palit at Greencrest Capital says when it comes to social media, nothing even comes close to Facebook.

"It is the biggest company in this space and we believe what makes it very unique from every other company that went public last year in this space is that it is very, very profitable," said Palit.

How profitable?  Early estimates suggest the social network is worth between $50 to $100 billion. David Kirkpatrick is author of The Facebook Effect:

"Will Facebook's IPO be the biggest IPO in American history, probably not, but it will certainly be by far the biggest Internet or technology IPO we've ever seen," said Kirkpatrick.

And when ticker symbol FB starts trading a few months from now, it could make Facebook founder Mark Zuckerberg - at 27 - one of the world's youngest billionaires.

Institutional investors are likely to get the first shot at buying Facebook stock. But asset manager Jim O'Shaugnessy says that's not such a bad thing.

"Many IPO's come out being very, very overvalued because they get so hyped up and investors are so taken in by the story that they're willing to pay any amount just to be able to get into the stock," said O'Shaugnessy. "That generally translates to being very overvalued.  So we generally tell investors that they should wait, probably a good full year before they look at buying stock that was recently IPO'd."

Market performance for Internet IPO's often does not live up to the hype.  The most recent - LinkedIn, Groupon and Zynga, all saw share prices plummet as much as 25 percent after going public.

There were similar doubts about Google when it went public in 2004. Back then Google stock sold for $84.  Today it's worth almost $600 a share.

Despite the risks, analysts say there's no shortage of investors willing to take a chance on the next big thing.

You May Like

Pundits Split Over Long-Term US Role in Afghanistan

Security pact remains condition for American presence beyond 2014; deadline criticized More

US Eyes Islamic State Threat

Officials warn that IS could pose a threat to US homeland More

Video Ukraine: Captured Troops Proof of Russian Role in Separatist Fight

Moscow says Russian troops crossed into Ukrainian territory by mistake More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Scientists Unlock Mystery of Bird Flocksi
X
George Putic
August 25, 2014 4:00 PM
How can flocks of birds, schools of fish or herds of antelope suddenly change direction -- all the individuals adjusting their movement in concert, at seemingly the same time? British researchers now have some insights into this behavior, which has puzzled scientists for a long time. VOA's George Putic has more.
Video

Video Scientists Unlock Mystery of Bird Flocks

How can flocks of birds, schools of fish or herds of antelope suddenly change direction -- all the individuals adjusting their movement in concert, at seemingly the same time? British researchers now have some insights into this behavior, which has puzzled scientists for a long time. VOA's George Putic has more.
Video

Video Ukraine: Captured Troops Proof of Russian Role in Separatist Fight

Ukrainian officials say they have captured Russian soldiers on Ukrainian territory -- the latest accusation of Moscow's involvement in the conflict in eastern Ukraine. VOA's Gabe Joselow reports from the Ukrainian side of the battle, where soldiers are convinced of Russia's role.
Video

Video Rubber May Soon Come From Dandelions

Synthetic rubber has been around for more than a century, but quality tires for cars, trucks and aircraft still need up to 40 percent or more natural rubber content. As the source of natural rubber, the rubber tree, is prone to disease and can be affected by bad weather. So scientists are looking for replacements. And as VOA’s George Putic reports, they may have found one in a ubiquitous weed.
Video

Video Jewish Life in Argentina Reflected in Yiddish Tango

Jewish people from across Europe and Russia have been immigrating to Argentina for hundreds of years. They brought with them dance music that was eventually mixed with Argentine tango. The result is Yiddish tango -- a fusion of melodies and cultural experiences that is still evolving today. Elizabeth Lee reports on how one band is bringing Yiddish tango to Los Angeles.
Video

Video Peace Returns to Ferguson as Community Tries to Heal

Thousands of people nationwide are expected to attend funeral services Monday in the U.S. Midwestern city of St. Louis, Missouri, for Michael Brown, the unarmed African-American teenager who was fatally shot by a white police officer August 9 in the St. Louis suburb of Ferguson. The shooting touched off days of violent demonstrations there, resulting in more than 100 arrests. VOA's Chris Simkins reports from Ferguson where the community is trying to move on after weeks of racial tension.
Video

Video Meeting in Minsk May Hinge on Putin Story

The presidents of Russia and Ukraine are expected to meet face-to-face Tuesday in Minsk, along with European leaders, for talks on the situation in Ukraine. Political analysts say the much welcomed dialogue could help bring an end to months of deadly clashes between pro-Russia separatists and Ukrainian forces in the country's southeast. But much depends on the actions of one man, Russian President Vladimir Putin. VOA's Daniel Schearf reports from Moscow.
Video

Video Artists Shun Russia's Profanity Law

Russia in July enacted a law threatening fines for publicly displayed profanity in media, films, literature, music and theater. The restriction, the toughest since the Soviet era, aims to protect the Russian language and culture and has been welcomed by those who say cursing is getting out of control. But many artists reject the move as a patronizing and ineffective act of censorship in line with a string of conservative morality laws. VOA's Daniel Schearf reports from Moscow.
Video

Video British Fighters on Frontline of ISIS Information War

Security services are racing to identify the Islamic State militant who beheaded U.S. journalist James Foley in Syria. The murderer spoke English on camera with a British accent. It’s estimated that several hundred British citizens are fighting for the Islamic State, also called ISIL or ISIS, alongside thousands of other foreign jihadists. Henry Ridgwell reports for VOA from the center of the investigation in London.

AppleAndroid