What Is An Initial Public Offering (IPO)?

An Initial Public Offering or IPO is the very first sale of stock to the public by a private company. This is also known as 'going public'. There are two kinds of companies who will undertake an IPO:

  • Startup companies looking to raise capital and investors
  • Large private companies looking to become publicly traded

A company looking to conduct an IPO will usually employ an investment bank to help with the IPO, with the advisory service provided including valuation and timing. Investing in IPO companies is usually risky as there is no historical data on the performance of the stock and the stock of newly public companies typically tends to fluctuate wildly after and on the IPO date.

To learn more about this concept and become a master at valuation modeling, you should check out our Valuation Modeling Course. Learn more here.

Module 1: Introduction

Module 2: Valuation: The Big Picture

Module 3: Enterprise Value & Equity Value Practice

Module 4: Trading Comparables Introduction

Module 5: Trading Comps: The Setup

Module 6: Trading Comps: Spreading Nike (NKE)

Module 7: Trading Comps: Spreading Adidas (ADS.DE)

Module 8: Trading Comps: Spreading Lululemon (LULU)

Module 9: Trading Comps: Spreading Under Armour (UA)

Module 10: Trading Comps: Benchmarking and Outputs

Module 11: Precedent Transactions: Introduction

Module 12: Precedents: The Setup

Module 13: Spreading Tiffany & LVMH

Module 14: Spreading FitBit & Google

Module 15: Spreading Reebok & Adidas

Module 16: Spreading Jimmy Choo & Michael Kors

Module 17: Spreading Dickies & VF

Module 18: Valuation Wrap-Up

Module 19: Bonus: Non-GAAP Practice

Learn More Here

Related Terms

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