Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Investing in the METAVERSE Stocks Universe - 8th Dec 21
Stock Market Sentiment Speaks: I Expect 15-20% Returns For 2022 - 8th Dec 21
US Dollar Still Has the Green Light - 8th Dec 21
Stock Market Topping Process Roadmap - 8th Dec 21
The Lithium Breakthrough That Could Transform The Mining Industry - 8th Dec 21
VR and Gaming Becomes the Metaverse - 7th Dec 21
How to Read Your Smart Meter - Economy 7, Day and Night Rate Readings SMETS2 EDF - 7th Dec 21
For Profit or for Loss: 4 Tips for Selling ASX Shares - 7th Dec 21
INTEL Bargain Teck Stocks Trading at 15.5% Discount Sale - 7th Dec 21
US Bonds Yield Curve is not currently an inflationist’s friend - 7th Dec 21
Omicron COVID Variant-Possible Strong Stock Market INDU & TRAN Rally - 7th Dec 21
The New Tech That Could Take Tesla To $2 Trillion - 7th Dec 21
S&P 500 – Is a 5% Correction Enough? - 6th Dec 21
Global Stock Markets It’s Do-Or-Die Time - 6th Dec 21
Hawks Triumph, Doves Lose, Gold Bulls Cry! - 6th Dec 21
How Stock Investors Can Cash in on President Biden’s new Climate Plan - 6th Dec 21
The Lithium Tech That Could Send The EV Boom Into Overdrive - 6th Dec 21
How Stagflation Effects Stocks - 5th Dec 21
Bitcoin FLASH CRASH! Cryptos Blood Bath as Exchanges Run Stops, An Early Christmas Present for Some? - 5th Dec 21
TESCO Pre Omicron Panic Christmas Decorations Festive Shop 2021 - 5th Dec 21
Dow Stock Market Trend Forecast Into Mid 2022 - 4th Dec 21
INVESTING LESSON - Give your Portfolio Some Breathing Space - 4th Dec 21
Don’t Get Yourself Into a Bull Trap With Gold - 4th Dec 21
GOLD HAS LOTS OF POTENTIAL DOWNSIDE - 4th Dec 21
4 Tips To Help You Take Better Care Of Your Personal Finances- 4th Dec 21
What Is A Golden Cross Pattern In Trading? - 4th Dec 21
Bitcoin Price TRIGGER for Accumulating Into Alt Coins for 2022 Price Explosion - Part 2 - 3rd Dec 21
Stock Market Major Turning Point Taking Place - 3rd Dec 21
The Masters of the Universe and Gold - 3rd Dec 21
This simple Stock Market mindset shift could help you make millions - 3rd Dec 21
Will the Glasgow Summit (COP26) Affect Energy Prices? - 3rd Dec 21
Peloton 35% CRASH a Lesson of What Happens When One Over Pays for a Loss Making Growth Stock - 1st Dec 21
Stock Market Sentiment Speaks: I Fear For Retirees For The Next 20 Years - 1st Dec 21 t
Will the Anointed Finanical Experts Get It Wrong Again? - 1st Dec 21
Main Differences Between the UK and Canadian Gaming Markets - 1st Dec 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Why Spotify Will Likely Surge During Its IPO

Companies / IPOs Mar 22, 2018 - 07:01 AM GMT

By: Boris_Dzhingarov

Companies IPO’s are nothing new to the market. At the end of the day, companies go public all the time. Some of them fly out of the gates, some of them fall dramatically, and others stay relatively flat. However, when it comes to spotify in particular, this thing is likely to soar.

Sure, the company is a strong company, and there’s definitely value here. However, that’s not the primary reason that the Spotify stock price is likely to rocket on the launch of the IPO. The big reason has to do with the unique aspects of the shares that will become available when the IPO goes public. Today, we’ll talk about what’s so unique about the shares that will be sold during the Spotify IPO, why this unique aspect will likely lead to a big spike in value right out of the gate, and what to watch for following the IPO launch.




What’s So Unique About The Spotify Shares That Are Being Sold In The IPO?

The Spotify IPO is like nothing else that we’ve seen before. Sure, like any other IPO, this one will turn Spotify into a publicly traded company. However, that’s about the only thing that’s the same. Lately, there has been quite a bit of discussion surrounding the unorthodox approach to marketing and celebration of the IPO. Essentially, there will be no celebrations or bell ringings, and marketing will not happen behind closed doors. However, what really makes the Spotify IPO unique is the shares that will be sold during the offering.

In general, when an IPO takes place, the privately traded company sells newly created shares in an effort to raise funds, becoming public in the process. However, when it comes to the Spotify IPO, there will be no new shares created. Instead, the only shares that will available during the IPO are shares that have already been issued and that are already owned by shareholders in the company. Personally, I’ve never seen an initial public offering transaction quite like this one, and after doing quite a bit of research, I don’t think that there has been a history of a transaction like this in the past.

Why This Is Likely To Lead To A Tremendous Spike In Value

At the end of the day, the unique way in which Spotify is going about its IPO will likely create a bit of a spike. The reason for this is relatively simple. During a traditional IPO, newly created shares are made available. This means that the supply of shares is generally large enough to cover the demand for those shares. However, this isn’t the case when it comes to the Spotify offering.

As mentioned above, the only shares that are going to be made available during the Spotify IPO will be shares that are already owned. Therefore, in order for a share to be available to purchase, a shareholder is going to have to want to sell. With the lack of supply on the market, demand is likely to naturally outpace the supply of shares, ultimately leading to a spike.

Think about it, demand for a Spotify IPO is going to be incredibly large as is. The company is right behind Pandora when it comes to streaming music market share and it has built its way to become a household name. This is naturally going to create demand. However, by creating the “you can’t have it” feeling due to limited supply, demand could grow even more. Not to mention the fact that the unorthodox way in which the company is going about its IPO is leading to more publicity than the average IPO sees. Putting this all together suggests that we’re going to see some pretty strong demand, leading to heavy spikes in value on the day of the IPO.

What To Watch Following The Launch

With the IPO just around the corner, we have exciting times ahead. To take advantage of the movement, make sure to keep a close eye on the shares available for purchase and the demand for the shares upon the IPO. Also, watch for wild swings as large shareholders offload and those looking to get involved pick up the shares that become available! Nonetheless, the Spotify IPO is likely to be one of the most exciting offerings we’ve seen in some time!

By Boris Dzhingarov

© 2018 Copyright Boris Dzhingarov - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in