Page 4 - Initial Public Offering - An Introduction to IPO on Wall Street

Table of Contents

Acknowledgments..................................................................................................................14
About the Author ...................................................................................................................17

a word from his mentor ..........................................................................................................19

a word from his first partner ..................................................................................................20
1. Definition .....................................................................................................................21

2. Introduction to IPO ......................................................................................................24
2.1 What is an IPO? .................................................................................................................... 25

2.2 What is an IPO Valuation? .................................................................................................... 25

2.2.1 The Components of an IPO Valuation ........................................................................... 25
2.2.2 Demand for Company’s Stock and IPO Valuation ............................................................ 25

2.2.3 Industry Comparables .................................................................................................... 27
2.2.4 Growth Prospects ........................................................................................................... 27

2.2.5 A Compelling Corporate Narrative ................................................................................ 27

2.2.6 Risks of Investing in IPOs ............................................................................................. 27
2.2.7 Key Takeaways .............................................................................................................. 28

2.3 The Challenges with IPOs in the Past ................................................................................... 28

2.3.1 Problems for Investors ................................................................................................... 29
2.3.2 Problems for Businesses ................................................................................................ 29

2.4 Easing of IPOs ...................................................................................................................... 29
2.5 The Changing Nature of Public Equity Market .................................................................... 29

2.6 The Role of Investment Banks .............................................................................................. 30

3. Disclosure ....................................................................................................................31
3.1 The Full Disclosure Principle ............................................................................................... 31

3.1.1 Full Disclosure Requirements ........................................................................................ 33
3.1.2 Where to Disclose the Information? .............................................................................. 33

3.2 Disclosure Document ............................................................................................................ 33

3.2.1. Prospectuses ...................................................................................................................... 34
3.2.2 Information Statement Revealing the Offer ................................................................... 34

3.2.3 Profile Statements .......................................................................................................... 34

3.2.4 A Two-Part, Straightforward Brochure on Corporate Bonds ........................................ 34
3.3.5 S-1 ...................................................................................................................................... 35

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