How to Choose IPO Stocks Guaranteed to Flow Cash
Rancakmedia.com – If you want to know how to choose IPO stocks that will keep your cash flowing, you can find out by reading the article we provide below.
IPO or initial public offering is the first sale of a company's shares to the public. Due to the lack of prior financial performance data, many analysts believe that investing in newly listed equities is a dangerous proposition.
Due to price speculation, short-term trading in this stock is also dangerous. Also, liquidity is usually minimal which can lead to considerable volatility.
Even if the risk is big, investors can still earn big profits! Opportunity to buy shares IPO can reach hundreds of percent, but it can also reach 70 percent if you lose.
List of How to Choose the Right IPO Shares
This time, Rancak Media would like to provide some advice on how to choose IPO shares wisely to maximize profits.
1. Pay Attention to Issuer's Fundamental Factors
To attract buyers, issuers often sell their securities at a price during the first offering phase.
To invest or buy shares of new issuers, we need to pay attention to the basic considerations. Low stock prices can be attributed to poor fundamentals.
If we look at the valuation of stocks in terms of the amount of profit generated and the equity value of a company, we can use ratios such as price to earnings ratio (PER) or book value to price (PBV).
2. Read the Issuer's Prospectus
Purchasing stock before an IPO should include a thorough prospectus review. Before going public, prospectuses are often issued, and contain information about a company, such as its history, industry, and financial statements.
It is important to pay close attention to this report so that we understand the increase in profits, the strength of the balance sheet, and the cash flow situation experienced by the issuer in recent years.
In addition, pay attention to the commercial prospects of issuers. Issuers with outstanding commercial prospects, their shares should be valued highly in the future. That way, the stock price won't drop in the months following the IPO.
3. Understand the Purpose of the IPO
Issuers often have a specific goal in mind when launching an initial public offering. Anyone considering investing in an initial public offering (IPO) should know whether the money raised will be used to finance growth or to buy debt.
Issuers who plan to utilize funds from their IPO to support business venture new message sends a good message, and we can all benefit from it. Be wary of issuers whose sole purpose is to pay their obligations.
This kind of publisher may have a hard time succeeding because they need a lot of financial assistance to keep their organization afloat. If the current trend continues, the funds we have saved will be used up or maybe lost.
4. Check stock price performance
Check the stock price performance a few days after listing if we buy IPO shares on the secondary market.
A profitable stock price on the first day indicates that the stock can last for another month, according to research relating to IPO stock patterns.
Stocks that fall in price on the first day of stock are more likely to remain underpriced in the future.
FAQs
Below we have summarized some frequently asked questions about IPO shares, as follows:
What is the Minimum IPO Shareholders?
With a minimum limit of 150 million shares, while the number of shareholders is 500 parties or more.
What Are the Advantages of IPO Shares?
Dengem buys IPO shares, has the potential to get up to two times the profit on the first day the shares are listed on the Indonesian Stock Exchange (IDX). The movement in IPO shares on the initial day when the initial listing or listing on the stock exchange has the potential to increase significantly.
Conclusion
IPO or initial public offering is the first sale of a company's shares to the public. Due to the lack of prior financial performance data, many analysts believe that investing in newly listed equities is a dangerous proposition.
This is an article about Knowing How to Choose IPO Shares, Guaranteed to Flow Cash. Hopefully this article can be helpful and useful for all of you in choosing IPO shares.