Essay Instructions: Initial Public Offering
The main purpose of an initial public offering (IPO) is to raise capital for the corporation. While IPOs are effective at raising capital, being listed on a stock exchange comes with heavy regulatory compliance and reporting requirements, which are expensive.
The Session Long Project (SLP) for the course will be performed using information on a company that is listed on the New York Stock Exchange (NYSE). To complete the Module 1 SLP, choose a company that is publicly traded in the stock market. If you are unsure which company to choose, you can look through this list of companies in the S&P 500 (http://finance.yahoo.com/q/cp?s=%5EGSPC). The company cannot be a financial institution such as a bank, insurance company or a trust company.
Note: If you have taken FIN301 at TUI, choose a different company than the one you previously chose.
The company that you choose will be ?your SLP company? for the entire course. State the name of that company in each of the Session Long Project reports.
Search for the company's website and find the section called "Investor Relations" to obtain the financial information of the company over the past several years. For the first module, write a 3- to 4-page paper answering the following questions:
1) Provide a brief description of the company you chose, its main business and operational activities and a short synopsis of the main developments of the company over the past few years.
To answer Question 1, include the following, together with other information that you would like to provide:
?Current stock price of the company.
?Company sales/revenue for the past three years (e.g., 2010, 2011, 2012).
?Company profitability (net income) for the past three years.
?Total assets for the past three years.
?Total liabilities for the past three years.
?Owners? equity for the past three years.
?Other financial information you find relevant.
Use a table to provide the above information.
To access the above information, go to http://finance.yahoo.com, key in the company symbol (e.g., GE for General Electric), click on ?Key Statistics? and then view financials as well (underneath Key Statistics table).
2) Explain why you chose this company (e.g., what makes it interesting to you personally? Is it profitability of the company over the last three years or something else?). Keep in mind that one of the main goals of a for-profit corporation is the ?maximization of shareholders? wealth.?
3) This is the main part of the assignment. Find out what you can about your SLP company's IPO. If it is a newer corporation, this should not be too difficult. But if it is an older company this might be difficult. If you cannot find any information about your company's IPO, discuss how you would go about taking your company public using what you have learned from the background materials and from Question 1.
Keep in mind that the Securities and Exchange Commission will not approve a financially weak and unprofitable company to be listed on a stock exchange.
4) What do you perceive you have learned in the Module 1 SLP? Which of the following learning outcomes do you feel you have mastered?
?Identify success factors for a firm making the IPO decision.
?Describe the steps a firm must take in order to go public.
Provide a brief evaluation of the Module 1 SLP.
Note: Your report/assignment will not be accepted without proper citations and references. You must use the sources from the background material together with the sources you find on your own. It is also required that you answer all the questions related to learning outcomes.
In the Module 1 SLP, you are expected to:
?Describe the purpose of the paper and provide a conclusion. An introduction and a conclusion are important because many busy individuals in the business environment may only read the first and the last paragraph. If those paragraphs are not interesting, they never read the body of the paper.
?Answer the SLP questions clearly and provide necessary details. Review ?Tips for Good Writing? [https://cdad.trident.edu/CourseHomeModule.aspx?course=56&term=92&module=3&page=custom1] and a guideline to write a well-structured paper.
?Write clearly and correctly?that is, no poor sentence structure, no spelling and grammar mistakes, and no run-on sentences.
?Provide citations to support your argument and place references on a separate page. Use APA format to provide citations and references [http://owl.english.purdue.edu/owl/resource/560/01/].
?Answer all the SLP questions in an essay format. Do not type questions in the paper.
?Type and double-space the paper.
Excerpt From Essay:
Total Pages: 5 Words: 1625 Works Cited: 4 Citation Style: MLA Document Type: Research Paper
Essay Instructions: Initial public offering (IPO) is defined as the first sale of stock by a company. Companies like Avaya (http://www.avaya.com/usa/) looking to further the growth often use an IPO as a way to generate the capital needed to expand. Avaya is a global leader in business communications systems. The company provides unified communications, contact centers, data solutions and related services directly and through its channel partners to leading businesses and organizations around the world. Currently, Avaya is planning for IPO. You can read more by accessing the following information source:
Klassen, M. (2011). Report: Avaya planning to go public. Retrieved August, 2011, from http://www.thetelecomblog.com/2011/06/08/report-avaya-planning-to-go-public/
Given Avaya's global online audience and untraditional business model, it is not clear which method would be best for them when they decide to go public.
Do some reading up on the online IPO process used by Google and Morningstar using internet search engines. This is an untraditional approach to the IPO, but may or may not be the best approach for Avaya?s IPO.
Carter, A. (2005). Morningstar follows Google's lead. Retrieved August, 2011, from http://www.businessweek.com/bwdaily/dnflash/jan2005/nf20050110_8372_db035.htm
Write a 4 to 5 pages report for the executives of Avaya corporation by answering the following questions.
What type of IPO should Avaya use - a traditional IPO or an online auction? Based on your analysis and findings, what would you recommend to the executives of Avaya corporation? Please explain your reasoning in detail.
Some issues to consider in answering the above question include:
i) The type of investors Avaya is likely to attract
ii) The lessons learned from Google and Morningstar from their auction IPOs
iii) Advantages of each type of IPO
iv) Costs and risks of each type of IPO
Excerpt From Essay:
Essay Instructions: create a one to two-page document identifying the similarities and differences between the IPOs of Google and Amazon.com. Synthesize the results in a paragraph or two showing how the resulting IPOs have led to these companies’ success, and support your conclusions with appropriate references.
# Befumo, R. (1997, May 15). Amazon.com Debuts. The Motley Fool. Retrieved August 25, 2006, from http://www.fool.com/Features/1997/sp970515aAmazonDebuts.htm
# IPOGoogle.org. (n.d.) The Google Initial Public Offering: August 13th, 2004. Retrieved August 25, 2006, from http://www.ipogoogle.org/
# Salkever, A. (2004, May 3). The How and Why of Google's Auction. Business Week Online. Retrieved August 25, 2006, from "http://www.businessweek.com/technology/content/may2004/tc2004053_
# Watson, J. (2001, February 19). The Discounters. Forbes Retrieved August 25, 2006, from http://www.forbes.com/2001/02/16/0219iporetail.html
Excerpt From Essay:
Essay Instructions: Research Assignment
Select a financial management topic and investigate (research) the selected topic with respect to a real world application, such as a specific firm or industry. For example: You may select Financial Ratios as the concept and investigate, say, Home Depots' financial ratios and make conclusions based on your findings. You should place yourself in the role of a media reporter or investigator for this project.
Term Paper Topic
Research the Initial Public Offering of Google and investigate the Financial Management Strategies behind the IPO process. What makes this IPO different from conventional IPOs? What does the company plan to gain from the IPO? How does the company determine what opening stock price to set? How does the Cash Flow of Google compare to other organizations with similar stock prices?
Excerpt From Essay:
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