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Yes. But isn't the IPO most often represent the biggest capital inflow of a company's life typically? How would any post-IPO debt issuance or sales of stock com
by acdanger 9y ago
Yes. But isn't the IPO most often represent the biggest capital inflow of a company's life typically? How would any post-IPO debt issuance or sales of stock compare to the cash generated from the IPO.
- didgeoridoo 9y agoUnless you're Apple, which raised about $100M in its IPO, and currently makes about $500M in revenue per day.
- acdanger 9y agoThat's not directly tied to their stock price though. Apple could suffer a corporate scandal tomorrow and their stock price could fall 20% and revenues could be largely unaffected. I just don't follow the reasoning that stock price enables resource allocation.
- bandrami 9y agoIt doesn't; you're exactly right. It's something people who hold for value (i.e. baseball cards or tulips) rather than for income (i.e. dividends, or what people used to hold stocks for for centuries) tell themselves.