Facebook Vs. Google Vs. Blackstone: Comparing Post-IPO Performance
Lots of folks are comparing Facebook to Google and Blackstone, so let's see how each performed post-IPO.
MINYANVILLE ORIGINAL Very often, a mega-IPO can serve to define an important economic trend.
Friday's Facebook (FB) deal most certainly fits that bill, as it is the top dog in the social craze that is dominating the technology industry.
In fact, many are comparing Facebook's IPO to another generation-defining IPO -- that of Blackstone (BX), which went public in 2007 just as things could not possibly get any better in private equity. The Blackstone IPO top-ticked private equity, and now a big worry on Wall Street is that Facebook just marked the top for social media.
So why not compare the post-IPO performance of Facebook and Blackstone, and for the heck of it, throw in Google (GOOG), the last generation-defining Internet IPO?
As you can guess, Facebook's a bit of a mess.
Let's look at the numbers, starting with the first day of trading:
Facebook had an offering price of $38/share. On Friday, it opened at $42.05 and hit a high of $45 before closing at $38.23 for a gain of just 0.6% above the offering price.
This is much, much worse than our old friend Blackstone.
On its own opening day, Blackstone opened at $36.45, hit a high of $38, and closed at $35.06 for a whopping first-day gain of 13% above its $31 offering price.
Google had an even better first day. After being reduced, it priced its deal at $85, and saw its stock open at $100 and hit a high of $104.06 before closing at $100.34. So getting into Google at $85 proved to be a sweet deal as it generated an 18% first-day gain.
Right off the bat, Facebook had one lackluster opening day relative to these other big names:
And keep in mind, Facebook only stayed above $38 because underwriters like Morgan Stanley (MS) and JPMorgan (JPM) put their
own money up to avoid the embarrassment of Facebook breaking its IPO price on opening day.
So that 0.6% -- which is not impressive in and of itself -- was artificially generated.
Facebook, like Blackstone, is also having a lousy second day, and down 12% as of the time I'm writing this. Google, however, fared much better:
For the next chart, I put each name on a scale of 100 to focus on pure price performance. Here's what Google and Blackstone did in their first 10 days of trading:
Click to enlarge
As you can see, Facebook is off to a lousy start. Google was roughly flat after ten days, while Blackstone was down about 10%.
However, what investors should really pay attention to is the fact that on its seventh day of trading, Blackstone closed at $29.27 for a decline of 6% from its offering price, and a decline of 17% from the first-day close.
Facebook, already down 11% from its offering price and 12% from its first-day close, is already on a much steeper downward slope.
But only time will tell if Facebook looks more like this:
What do you think?
Leave a comment, send a smoke signal, or hit me up on Twitter: @MichaelComeau
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