The Nasdaq one hundred index is up about 7% to date, well above the 4.6% rise inside the Normal & Poor's 500 index.
Strong earnings last week from Intel Corp. (Nasdaq: INTC), Microsoft Corp. (Nasdaq: MSFT) and International Business Machines Corp. (NYSE: IBM) have drawn still more attention to tech shares.
But while technology companies may look appealing at this time, understanding which tech companies to avoid will prevent a lot of pain to your portfolio in 2012.
So here is one tech companies you should avoid, at least for now.
Upon the very first day of investing, Groupon carried out a lot better than some anticipated, rising thirty.55% to be able to $26.14 a discuss from its preliminary $20 for each reveal provide price.
Handful of expect in which put to be able to last, nevertheless. As well as the sooner Groupon fades, the more discouraging it'll be to the lots of businesses looking to go community.
Deserved or otherwise not, a few of the trader mania regarding social media stocks - many of which travelled community earlier this year, such as Linkedin Business (Can be: LNKD) as well as The planet pandora Mass media (Can be: G) and some of which are intending IPOs, like Fb Incorporated. and Zynga Inc. -- provides rubbed off upon Groupon.
But Groupon's quickly replicated business model, fuzzy accounting methods and struggles to succeed in profitability have many experts questioning the daily-deal company's ability to survive, much less keep growing.
Groupon's shaky long-term prospects are not the kind of news the IPO market needs right now. The optimism in the spring - when 69 companies had gone public by May 31 - all but evaporated around a tumultuous summer for companies rocked by the debt ceiling debate in Washington and rising concern over the sovereign debt crisis in Europe.
Additionally, Groupon's IPO was structured to ensure the price spiked on launch. To keep demand artificially high, only 5.7% of the company, or 35 million shares, were floated. While in the neighborhood of other social media IPOs this year such as LinkedIn (8.3%) and Pandora (9.2%), it's much below the 27% average IPO for tech companies, not to mention the 40% average for all IPOs.
Groupon, Inc. (Nasdaq: GRPN) - Groupon set a record last year for an initial public offering (IPO) and had the largest valuation of any Internet company since Google debuted in 2004. But the online deal company has lost significant value and looks to be a loser in 2012.
The Groupon stock opened at $20 a share and shot up by a lot more than 50% to $31. It then dropped underneath the offer value however is now returning to break even. The company is constantly on the generate losses and will probably achieve this throughout this year. Accurate, Groupon has lots of funds inside the again and no debt, however, you will find much better technical businesses on the market with more robust cashflow as well as sound income. For 2012, Groupon can be a technical stock to avoid.
But expert uncertainty more than Groupon's long-term prospects and lingering fears over the European debt crisis, as well as the tepid U.S. economy, mean that the dry spell for the IPO market will stretch on into next year.
Strong earnings last week from Intel Corp. (Nasdaq: INTC), Microsoft Corp. (Nasdaq: MSFT) and International Business Machines Corp. (NYSE: IBM) have drawn still more attention to tech shares.
But while technology companies may look appealing at this time, understanding which tech companies to avoid will prevent a lot of pain to your portfolio in 2012.
So here is one tech companies you should avoid, at least for now.
Upon the very first day of investing, Groupon carried out a lot better than some anticipated, rising thirty.55% to be able to $26.14 a discuss from its preliminary $20 for each reveal provide price.
Handful of expect in which put to be able to last, nevertheless. As well as the sooner Groupon fades, the more discouraging it'll be to the lots of businesses looking to go community.
Deserved or otherwise not, a few of the trader mania regarding social media stocks - many of which travelled community earlier this year, such as Linkedin Business (Can be: LNKD) as well as The planet pandora Mass media (Can be: G) and some of which are intending IPOs, like Fb Incorporated. and Zynga Inc. -- provides rubbed off upon Groupon.
But Groupon's quickly replicated business model, fuzzy accounting methods and struggles to succeed in profitability have many experts questioning the daily-deal company's ability to survive, much less keep growing.
Groupon's shaky long-term prospects are not the kind of news the IPO market needs right now. The optimism in the spring - when 69 companies had gone public by May 31 - all but evaporated around a tumultuous summer for companies rocked by the debt ceiling debate in Washington and rising concern over the sovereign debt crisis in Europe.
Additionally, Groupon's IPO was structured to ensure the price spiked on launch. To keep demand artificially high, only 5.7% of the company, or 35 million shares, were floated. While in the neighborhood of other social media IPOs this year such as LinkedIn (8.3%) and Pandora (9.2%), it's much below the 27% average IPO for tech companies, not to mention the 40% average for all IPOs.
Groupon, Inc. (Nasdaq: GRPN) - Groupon set a record last year for an initial public offering (IPO) and had the largest valuation of any Internet company since Google debuted in 2004. But the online deal company has lost significant value and looks to be a loser in 2012.
The Groupon stock opened at $20 a share and shot up by a lot more than 50% to $31. It then dropped underneath the offer value however is now returning to break even. The company is constantly on the generate losses and will probably achieve this throughout this year. Accurate, Groupon has lots of funds inside the again and no debt, however, you will find much better technical businesses on the market with more robust cashflow as well as sound income. For 2012, Groupon can be a technical stock to avoid.
But expert uncertainty more than Groupon's long-term prospects and lingering fears over the European debt crisis, as well as the tepid U.S. economy, mean that the dry spell for the IPO market will stretch on into next year.
About the Author:
Looking for news and investing advice that you can count on? Unlike other global market news sites all of your investing needs on topics such as GRPN can be found here with no hassle.
No comments:
Post a Comment