When a stock is breaking down, market technicians are usually trotted out to guestimate the nearest support level. Support, is as the name implies, an area where the selling may slow, even subside and if that's at an oversold area, with too many newbie shorts betting against the stock, an area that we might expect a sizable bounce.
div > div.group > p:first-child"> It is however, considerably more difficult to determine support or resistance for IPOs as they have virtually no trading history. But I said difficult, not impossible.As has been widely publicized, companies are remaining private far longer these days, as venture capital is plentiful. If used to be rare to see four rounds of funding, but today it is more then rule than the exception.
Then we had the high-publicized IPO for Lyft, in which the offering was oversubscribed to the point where the initial estimate of $62 a share was pushed higher and higher until the ride sharing company finally settled on a $72 a share offer of 30.77 million shares. This $2.2 billion pushed the initial valuation to about $20 billion 38 percent above that final funding round just nine months earlier.
So as I read Seaport Global Securities analyst Michael Ward initiated coverage of LYFT at $42 a share I was not surprised. $42 is quite close to that final funding round, which on a non-diluted basis would be about $44.64 a share.
LYFT will be happy for a while, then disappear. In the end, the one with FSD will rule this field.
jonnajarian jimcramer Some disagree...
Exactly what I said in front of IPO. IF anything, you Wait on that $LYFT. One could argue, it may never be a time to buy the stock. Like $ZNGA jimcramer. But first things first, let it get cut in half from IPO. Call it 35.
Nooooooo! Say it isn’t so!
Where were these voices last week?