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Just two days before the official pricing of Facebook's shares, the company shows more confidence
In the final stretch to reach the public market, Facebook has filed another updated S-1, upping the per share price range from $28-$35 to $34-$38.
It looks like the company roadshow and inquiries seem to be going well. Facebook will also offer underwriters the right to purchase up to an additional 50.6 million shares of Class A common stock to cover over-allotments.
That brings the total shares expected to be offered on Friday to 388 million in order to raise at least $13.1 billion -- which would place the company valuation between $92 billion and $103 billion.
Facebook (which will be trading on the Nasdaq under the symbol: FB) was initially expected to value at $100 billion, back in February when it first filed for IPO, but the various S-1 filings and speculation have pushed that expectation all over the board, even as low as $70 billion, at times.
Sterne Agee analyst Arvind Bhatia has a “buy” rating on Facebook, with a target price of $46.
Bhatia stated in a note that Facebook’s reach, engagement and relevance make the company a coveted stock. “Just like Google did less than a decade ago, we believe Facebook is disrupting the worldwide advertising market ... particularly its $68B sub-segment of online advertising.”
One of the biggest concerns looming is the recent discussion about the revenue drivers in Facebook's mobile sphere. Last week, Facebook updated its own S-1 filing to point out that its mobile is still an area of concern in growth and monetization, and focus on that arena has slowed other aspects of the company.
Even without weighing mobile customers and China too much, Bhatia believes Facebook can triple its revenue over the next four to five years.
Facebook is expected to price its stock Thursday afternoon and CEO Mark Zuckerberg will be ringing the trading bell remotely from the company headquarters in Menlo Park.
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