Are Initial Offerings Overpriced?

[Pearls Before Swine]

Maybe Uber isn't, but when IPO fever hits you can be sure that most of them are.  Any social media stocks are probably selling for more than they should.  Investors who buy them right after they come out on the market likely are paying far too much for them, and it would be a better idea not to buy at all in my opinion.

The situation isn't quite as bad as it was two decades ago with the internet stock boom, at least as far as I can tell.  The market is still overpriced but there isn't the irrational euphoria that it saw back then.

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[teosanru]

Lyft, Pinterest, Zoom, Uber… these are the big names went to IPOs recently.
It seems IPOs are roaring back, especially compared with the freezing winter for ICOs.
SophonEX uses data to study whether the winter will also appear for IPOs, and shall we invest in these initial offerings? If so, how?

https://medium.com/sophonexchange/are-initial-offerings-overpriced-29c896dba35b?source=friends_link&sk=4f04597535434f96c1fe05101ff15745

Well being of rational mind I would never do the mistake of comparing an ICO with an IPO. IPO is much more regulated and much more real. You don't believe me? Let's get into the details
1. IPO has a minimum subscription or what we call a soft cap of about 90% of total fund raiser. While in cryptocurrencies this is set relatively too low only to about 30-40% of the total hard cap this is because there is no regulation.
2. IPO have proper books of accounts as they are normal companies and the funds which they have raised are their Equity shown on the Liabilites side of their Balance sheet which means in event of Winding up they will be paying their shareholder everything back. Have you ever heard an ICO paying everything back because project failed?
3. IPO prepare regular reports and their works can be pretty easily seen. Only about 2-4% go to utter failure immediately(in a couple of years) after going public while I have seen a 99% ICO never ever completing their project as promised by them in Whitepaper.
So despite of IPOs being overpriced they definitely offer the value for your money as it will always be in safe hands. But even a dollar spent in ICO is a dollar vanished into air.

[matchi2011]

we can say that because the price after that down, the project team must have reviewed and calculated the funds needed for development
many investors discourage new projects because they feel it has a big risk

Indeed, it was all risky investment and what's sad about those so-called offerings fails after the project launched. Participants felt being cheated when they observed the expensive ico price after being listed at exchanges didn't gain a promising price, sadly it went so low. This had made many previous investors hesitant when they've heard business offerings promoting this type of investment schemes.

Participants who did not deal with researching before investing with new offer projects will regret after failing to gain profits. Initial offerings that held from big exchange or reputable exchange have a higher chance to bring good outcomes. Don't just spend your money, always check the possibilities if the project  have potential to succeed, even if the value is overpriced if there's a good chance of success it's still profitable in the long run.

[dunfida]

we can say that because the price after that down, the project team must have reviewed and calculated the funds needed for development
many investors discourage new projects because they feel it has a big risk

Indeed, it was all risky investment and what's sad about those so-called offerings fails after the project launched. Participants felt being cheated when they observed the expensive ico price after being listed at exchanges didn't gain a promising price, sadly it went so low. This had made many previous investors hesitant when they've heard business offerings promoting this type of investment schemes.

Participants who did not deal with researching before investing with new offer projects will regret after failing to gain profits. Initial offerings that held from big exchange or reputable exchange have a higher chance to bring good outcomes. Don't just spend your money, always check the possibilities if the project  have potential to succeed, even if the value is overpriced if there's a good chance of success it's still profitable in the long run.

Long run results would be still on 50% chance if it would succeed or not and to admit that it do need some sort of hype before they do able to achieve that pumping situation.
Talking about their prices, they do normally set out that casual numbers basing on their entire supply just like on what we had seen on typical ICO pricing.
Im not saying overpriced but if you do look at it generally these shit tokens should really have no value but people do set out price via thin air.

[ropyu1978]

everything is according to calculations but when listing prices become disappointing, if people already know the risk then it's considered reasonable because investing can't get instant results
investors must also pay attention to development of projects undertaken by team

[TrevorS]

Participants who did not deal with researching before investing with new offer projects will regret after failing to gain profits. Initial offerings that held from big exchange or reputable exchange have a higher chance to bring good outcomes. Don't just spend your money, always check the possibilities if the project  have potential to succeed, even if the value is overpriced if there's a good chance of success it's still profitable in the long run.

I agree with you that ICO should be large enough, and have a listing on a large exchange with the support of large partners. In this case, the profit is guaranteed, BUT in the short term.
No one knows what will happen to the project in the long term. Always keep in mind that large investors are focused on income from such projects here and now, which means that in the future they will not invest in the project, but they will remove the first profit immediately after listing.

[boltz]

It depends on the project itself and what are you buying into as after this terms you can guide the price if its overpriced or underpriced. I think most of the ICO's are overpriced at the beginning but if you can catch the private investor ICO then you will have a chance to have some profits as soon as its lands on exchanges, if not , you will have to even wait until the project goes alive even more and tech is used in some way or simply wait for it to pump and you don't want to wait for a pump...maybe it never comes.

[cutesgirl]

Initial offering always have higher price for listing on exchange market, just today look lower price after listing with exchange market. Today many IEO always failed because have lower price with low interested by investor to buy after trading active. Price drop because they only take profit with IEO and never want to hold coin for long time because do not give positive effect to keep hold and waiting too long, just best ideas to get much money with IEO.

[desticy]

It depends on the project itself and what are you buying into as after this terms you can guide the price if its overpriced or underpriced. I think most of the ICO's are overpriced at the beginning but if you can catch the private investor ICO then you will have a chance to have some profits as soon as its lands on exchanges, if not , you will have to even wait until the project goes alive even more and tech is used in some way or simply wait for it to pump and you don't want to wait for a pump...maybe it never comes.

I do not think that this directly depends on the project, rather it depends on the market.
Look at what prices all ICOs started selling in 2018 and with what prices they began to bargain immediately after entering the market.
All investors are in a strong minus because of this. Therefore, I believe that ICOы is almost always overpriced.

[NewRanger]

Lyft, Pinterest, Zoom, Uber… these are the big names went to IPOs recently.
It seems IPOs are roaring back, especially compared with the freezing winter for ICOs.
SophonEX uses data to study whether the winter will also appear for IPOs, and shall we invest in these initial offerings? If so, how?

https://medium.com/sophonexchange/are-initial-offerings-overpriced-29c896dba35b?source=friends_link&sk=4f04597535434f96c1fe05101ff15745

If you want to get tokens in a cheaper price, don't invest on them while they are still on sale, wait until they released it on the market, because the price of it will be dump since they will release all of their tokens in the market at one shot, you should try it, it's way more effective on making profits than investing too early on them.

buying on exchanges has lower risk than participate in crowdsale.most of them was down, its happen to.projects that launched before IEO platform builded.ICO hype was gone now and replaced by IEO hype that ever be trend like previous system.usually some investors want sell their token immediately.and it caused price drop alot.

[Sithara007]

Lyft, Pinterest, Zoom, Uber… these are the big names went to IPOs recently.
It seems IPOs are roaring back, especially compared with the freezing winter for ICOs.

I don't know how can you compare Uber, Zoom.etc with ICOs such as HiveNet and GRAYLL. Uber, Zoom, Lyft.etc are in business for the past so many years. They have billions of USD in annual revenue (although right now many of them are in net loss). Uber itself have an user base numbering in hundreds of millions, which is increasing at a healthy pace every year.

Now let's take a look at the ongoing ICOs. There are a few good projects such as HiveNet (distributed cloud computing network) and FRED Energy (alternative energy promotion). There are some very good ideas out there. But the problem is that they don't have a final product yet. The development has just started. And they don't come cheap either. The hardcap for HiveNet is placed at $19 million. Do you really think that this is justified?

[Edraket31]

I don't think it is overpriced, it is upon the project pricing, it will be just up to us if that is worth by searching and reading some info about the project, and the project feasibility to grow if they are worth it to invest with or not. We should always be vigilant to our actions, we should not just rely on others opinion, we can consider but it is better if we do some investigations about the project.

[Xxmodded]

When initial exchange offering or IEO re open on big exchange market again? I want get recovery my money lost with last IEO on Binance. I want get much profit and could closed my lost money in Perlin IEO. I will try good way for selling after opening in exchange market without keep waiting on higher price, I will get much profit if have next IEO on binance and invest with higher amount to get big chance with earn money with IEO.

[leavolnhals]

Lyft, Pinterest, Zoom, Uber… these are the big names went to IPOs recently.
It seems IPOs are roaring back, especially compared with the freezing winter for ICOs.
SophonEX uses data to study whether the winter will also appear for IPOs, and shall we invest in these initial offerings? If so, how?

https://medium.com/sophonexchange/are-initial-offerings-overpriced-29c896dba35b?source=friends_link&sk=4f04597535434f96c1fe05101ff15745

We should invest in businesses that can bring us great profits in the future. In fact, the IPO has existed for a long time and it is still very hot in countries focusing on the stock market, especially the US.
For long term investment, I recommend investing in an IPO. The business will bring real value and no scams.

[cosmofly]

The initial high corporate valuation is normal if it is a potential business and is sought by many people.
When a business is launched in a new type of market with lots of demand, it will easily become a unicorn.
therefore, evaluating potential is more important than looking at value.

[dengpei]

IPOs cannot be overpriced since they are backed by actual past performance history of a firm and the beauty of it is that this data is verifiable. This is usually not the case with ICOs and IEOs where you are buying a token often connected to a theoretical documentation of how someone intends to solve problem X. Linkedin profiles and whitepapers can do much but won't be able to guarantee success to a greater extent. Most projects that have been raising funds in the past and continue to do so to this day are nothing but plain heists that are not even worth the papers where their names are printed on. IPO returns might not be that attractive but at least one can perform due diligence.

[ashmodeus]

well, did u already make your choice ?
if not,just choose,listen,both ICO and IEO even IPO basicaly they are good , if u make reserach first. you should be fine.
and about overpriced, well, we dont know exact price of initial offerings ? as long u see that worth for their project, i guess its no problem anymore.

SophonEX uses data to study whether the winter will also appear for IPOs, and shall we invest in these initial offerings? If so, how?

if u think that good, just go in, SophonEX have a lot of good team members.
about how , well, just find it by yourself.

[TheUltraElite]

The initial high corporate valuation is normal if it is a potential business and is sought by many people.

Which is absent in 99% of ICO or any such initial offering. They dont run a business to create something new. They are just raising money at an attempt to make something new from wannabe venture capitalists who dont even understand the meaning of the word "venture" - this is the average "crypto-enthusiast" you see everyday on this forum.

When a business is launched in a new type of market with lots of demand, it will easily become a unicorn.

The rarest and the most profitable type of investment that is.

therefore, evaluating potential is more important than looking at value.

Correct, but try evaluating the ICOs that happen. Not even one had any potential to be a game changer.

[familiaverde]

yes the initial offerings are overpriced but I am not clear which initial offerings here are you talking about. Initial offerings of stock market might be overpriced but they are worth the money you invest. ICO are not the same they are overprice infact i would say even $1 for an ICO is too much because they are nothing but shit token.

[Apaxy]

Perhaps I do not understand the essence of the question asked, but I could never figure out on what grounds the team evaluates its coins when the idea itself still exists only in plans and on White Paper.  Of course, if the company already has a real product, then the price of a coin can be determined very easily, but initially the team obviously overestimates the prices for new projects.  This applies to almost all new projects today.